Before the purchase, when the announcement wasn't official yet, I said that this acquisition is a good one, taking care of competition and giving eBay a bigger market share of the ticket reselling business.
First, eBay share gained back 3.17% of their value yesterday, as investors obviously reacted positively. What about analysts?
- Mary Meeker of Morgan Stanley expects the purchase to reaccelerate growth for the company. Meeker has an "Outperform" rating on EBAY and expects StubHub to help eBay's struggling tickets category whose growth dropped to 19% in the fourth quarter of 2006 from 31% a year earlier.
- Robert S. Peck of Bear Stearns even thinks that with StubHub, eBay could become a "formidable competitor" to the largest online ticketing platform, Ticketmaster and its TicketExchange. Ticketmaster is owned by IAC/InterActiveCorp. (NASDAQ:IACI).
- Jeetil Patel of Deutsche Bank who has a Hold rating on EBAY warns that the core business continues to struggle. He is more cautious.
- Douglas Anmuth of Lehman Brothers believes the acquisition is a good fit strategically.
- Justin Post of Merrill Lynch thinks that with StubHub, eBay will probably control 40% of the secondary ticket market.
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Reader Comments (Page 1 of 1)
1-12-2007 @ 2:51PM
Gary E. Sattler said...
Now we just wait to see how eBay plays out their hand. There are several ways they can go with this purchase as relates to current ebay operations. I hate to speculate on what they'll do now.
I'm holding my tounge.
1-12-2007 @ 2:47PM
Jimmy said...
EBay should also buy RazorGator and TicketsNow and really monopolize the secondary ticket market.
1-12-2007 @ 3:24PM
Randy Smythe said...
This purchase is the model for eBay's new acquisition strategy and I’m glad I can finally write something positive about eBay. Vertical marketplaces like Motors, Half.com, and StubHub are the future of eBay.
Purchases like Skype will not happen again IMHO. I believe Skype may eventually become a great business for eBay but they seriously overestimated how it would integrate with their marketplace business.
1-16-2007 @ 1:34PM
So True said...
Jimmy is right on here.
Even with Ebay and StubHub, TicketMaster still has the stronghold on the market. If Ebay were to snatch up the other major ticket resell companies (RazorGator and TicketsNow), the consolidated efforts of all would be a real defense against the beast.
1-17-2007 @ 1:26PM
Gene said...
It really doesn't matter what eBay buys they can't get their act right ever. The newest example is the elimination of the bidders ID when the price reaches $200. That makes it even easier for shill bidders to operate in a site where eBay has never admitted they exist in large quantities. Now many bidders who generally know everyone in their collectible field will generally worry who is bidder Number 13 who just raised your bid by some amount???? Is it a real bidder or just a shill taking the bid up a couple of increments???? Gene
1-14-2007 @ 5:39PM
Billy M said...
Someone suggested Ebay buy RazorGator and TicketsNow. TicketsNow is actually losing market share rapidly. There are only a few competing secondary hubs worth talking about when it comes to acquisition -> TicketsNow, TicketNetwork [probably largest amount of web sites in secondary market and largest amount of data, hard to say, other exchanges don't post their numbers], and RazorGator.....all three would probably be attractive to Ticketmaster
1-15-2007 @ 6:23PM
Marsello said...
It would be a huge challenge for eBay to bounce back to any sort of respectable growth. I would rather invest in pure growth stories such as GMarket from South Korea. The stock has been subject to market speculation at the end of December, thanks mainly to Jim Cramer's comments on MSNBC, but it has certainly more promise than eBay.
On a site note, I just found this song by Weird Al Yankovic about eBay which I think is hilarious!
1-17-2007 @ 6:57AM
Fruit Helmet Cat said...
Oh Melly I would be looking at the changes in the buyer protection. There's a reason why stubhub was so successful without ebay. Stubhub as a "venue" protected its members with a 100% Fan protect fraud guarantee. Ebay buyer protection has alot of loopholes, plus they just announced I think end of December they were changing their existing buyer protection to where you would only be protected if you use paypal. Anything else? You are out of luck!
It's going to give Ebay more money, that will improve their bottom line.. that's a really good thing... but when ticket buyers now hear they have to use paypal to be covered... big difference...Ebays not really good at that type of backlash/PR marketing other than an IT commercial. rofl. Unless of course ebay will get them special protected exemptions. I kinda hope that the do because no one wants to show up at an event and find out they got bunk tickets.
I would also like to report that Bidder 1 & Bidder 2 are shilling up their auction listings. Since I can no longer report them through ebay, this is probably better than blinking with my arms crossed.