he NY Post reports that Microsoft and eBay have been having merger discussions, and that, ironically, the talks have cooled of late because lawyers are concerned about anti-trust issues. Suffice it to say that if such a deal were blocked because of monopoly concerns, regulators would merely be demonstrating an astounding inability to grasp current market dynamics.
But more to the point–Is an eBay-MSN merger a good idea? In a word, no. It’s a bold idea, certainly, one that illustrates Microsoft’s seriousness about making MSN more than an also-ran. But eBay doesn’t need a portal draped on top of it, especially the third-ranked portal, and owning eBay won’t save MSN. The entity would have a fighting chance as a stand-alone company, but Microsoft seems determined to keep strangling its Internet division by keeping all its businesses all under the same roof. As a result, post-merger, eBay’s talent would rapidly depart for greener and less-humongous pastures. And as Microsoft struggled to integrate, staff, and manage a huge new business it knows nothing about, Google and Amazon would get a dream opportunity to chip away at the eBay seller base.
The most complementary assets Microsoft would gain in such a merger would be PayPal and Skype. Alas, unless the company intends to spin-off eBay’s marketplace business, this seems an awfully expensive way to get them.
Boldness, Vision, Ambition, etc.: A-
Chance of Practical Success: C-