This piece of news might be a few days old, but for those of you that haven’t heard, a few days ago eBay and Yahoo! announced an alliance, or what I would like to call a partnership, that will give Yahoo! control over all advertising on the eBay website and also ensure that Yahoo uses eBay’s PayPal for all online payments.
As a result of this partnership, Google and Microsoft have been shut out of what could have been extreme potential for growth. In the past all of eBay’s advertisement sales were in-house efforts. Bringing in a company like Yahoo!, that has great experience with online advertising due to their acquisition of Overture, will surely benefit both eBay and Yahoo!. eBay will take a certain percentage amount off of the revenues that Yahoo! generates through the advertisements displayed on the eBay website.
As a result of this alliance, Yahoo! will work with eBay on better and more effective website design in order to help the Yahoo! crawlers crawl the eBay website better. Yahoo! also stated that it will not manually manipulate eBay’s page-ranks within the Yahoo! search engine, but would rather crawl the eBay website more frequently which will result in better page ranks when the eBay website is optimized for the Yahoo! crawlers.
Not all is perfect with this alliance though. First of all, Yahoo! will take care of all advertisements on the U.S. version of the eBay website. Additionally, Yahoo! has to prove to eBay that it will be able to design advertisements that won’t drive away any of the eBay business, and finally both eBay and Yahoo are still competitors with Yahoo! having its own auction and classifieds system.
This article at TMCnet and this blog post at Blogging Stocks both raise some good points, such as the fact that eBay and Yahoo! should have teamed up years ago before Google was a major player, as their partnership right now is not as effective with Google in the marketplace. Or as the blog post on Blogging Stocks talks about this alliance being a “web-based partnership to thwart Google’s advances.”
This surely is an excellent alliance for both eBay and Yahoo in terms of creating opportunities for each other in terms of generating more revenues. But will this alliance be able to slow down Google? I do not think so. With Google dominating the online search-engine business, there is no way that anything will stop Google that easy. What are your opinions on this subject?
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