"San Jose's eBay cut its advertising Monday shortly after Google unveiled plans for a party in Boston to hawk its online payment service, Google Checkout. Attendees of eBay's user conference, eBay Live, which starts today, were all invited for free drinks, food and massages."
This is a little nutty. It's an increasingly bad business strategy to take total control over a small market rather than some control over a big one.
"For years, eBay has been Google's biggest U.S. advertiser"
Wow... seems odd that they didn't set up their own ad network earlier. I just don't see the lock-in for on-line ads - switching costs are low, and network effects are not really a factor.
I think the ads on Google search results pages were more important than AdSense, a few advertisers have said the conversion rates are much higher on the search results than on AdSense pages. But I wouldn't put it past eBay to start an AdSense competitor.
"In any case, eBay Live is frequently a stage for drama, and not just with Google. Alibaba, an eBay rival in China, found out the hard way at eBay Live last year in Las Vegas.
It had rented a restaurant in the hotel where eBay Live was holding a party.
An eBay executive who found out tried unsuccessfully to rent the restaurant from under Alibaba, according to an Alibaba executive and a hotel employee present during the animated discussion. The eBay executive eventually forced Alibaba to remove all of its signs."
So let me get this straight... EBay executives are a bunch of insecure bullying assholes? That, and they just gave up 188.3 million clicks from Google? Note, however that searching Google for "used Playstation 3" still gives me tons of appropriate results - including from other auctions.
Your experience on Google is no worse, but if eBay doesn't come back, Google's losing on the order of billions since they aren't selling high-priced ads at large volume to eBay.
Here it is. Google's achilles heel. They rely heavily on some of their competitors for revenue. Advertising will get in the way of technical innovation and head on competition.
Get out there young entrepreneurs! Google might still be the big leader in search, but their domination of all the commerce and information on the internet is certainly not guaranteed. They have enormous conflicts of interest.
It's their Achilles heel until it isn't, ya know? Microsoft was the software company with invaluable relationships creating products for, say, Apple, until that relationship wasn't as crucial to their being anymore.
But I definitely agree on your sentiments about the conflicts of interest. There's a lot of things to consider.
"San Jose's eBay cut its advertising Monday shortly after Google unveiled plans for a party in Boston to hawk its online payment service, Google Checkout. Attendees of eBay's user conference, eBay Live, which starts today, were all invited for free drinks, food and massages."
This is a little nutty. It's an increasingly bad business strategy to take total control over a small market rather than some control over a big one.