Google and eBay BFF again

While pottering around at Business Weekly.

And thus ends an amusing couple of weeks of blue chip churlishness and childishness. I wonder what they learned. Google ultimately abandoned its plan for the party that started the spat in the first place. EBay has learned it needs its partner-in-internet-traffic Google after all, else it would not have returned. They also seemed to have learned that they don’t need AdWords as much as they may have thought – it’s going to spend less than the previous USD25m, instead spending more on AOL, Yahoo and Microsoft.

Nobody has counted hard losses – USD450,000 per day in revenue for Google, 10% of traffic to eBay (although it only fell 7% – due to what were called organic results, when a google search comes up with eBay anyway, AdWords or no AdWords).

According to MSN’s Money Central they had different market reactions to the spat, specifically: eBay’s share price reacted poorly (it was the 15th):

ebay share price:

While Google’s reacted well (if it was reacting at all)

google share price

Both share prices responded positively to the reunion – eBay yet to return to pre-tantrum levels, indicating that perhaps the market doesn’t agree with them about the emancipation from AdWords of its incoming business. Google’s share price mostly did its own thing for the period.


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