Top management at it's peak is what can be resembled out of the Ebay vs Craigslist trial. Many might assume that it is just a case. Well, they might be right only if Ebay was not one of the largest online corporations that generated 8.5 billion of revenues in the year of 2008, and only if Craigslist was not the top US online classified site. According to the article, Ebay sued Craigslist for lowering its ownership stakes by around 4 percentages making Ebay owners of 24.85 percent of Craiglist. It did not take Craigslist much to respond; a month later, Craigslist sued Ebay for trying to take over Craiglist ownership so they can use Craigslist "secret success recipe" and launch its own classified site. In the following paragraphs, A closer look at the trial and comments of trial participants will be highlighted.
Whitman , who was the chief executive officer, took the stand on Monday saying that Ebay only reason for buying Craigslist stakes was to eventually gain full ownership of Craigslist. By doing so, Ebay can keep competitors in the house. It was revealed also by Whitman that Ebay had paid 32 million dollars or its stake in Cragslist, but then realized early on that gaining complete ownership over Craigslist would not be possible. The main rationale for Ebay case was that Craigslist's co founder and chief executive officer developed a coercive plan to lower its stake. On the other hand, Craigslist main rationale was that Ebay never mentioned that it was going to launch Kijiji, which was operating in the US by 2008.
Ebay explanation about not mentioning the launch of Kijiji was that Ebay had not closed the deal with Craigslist at the time and therefore retained from giving out this kind of sensitive information. Furthermore, Ebay founder Pierre Omidyar said that he did mention to Craigslist that Ebay plans to strongly enter the classified online market. What's interesting about this is the difference between these two corporations; Ebay is a huge corporations with hundreds of employees whereas Craigslist is a small privately owned company with maybe 25 employees or so. This makes one think how creativity and hard work can change lives. The trial would most likely go for a week and all we can do is wait!
Ahmed,
ReplyDeleteNice choice of article! I never read the article, so I'm glad you summarized it. Mergers and acquisitions in the IT industry are so numerous, its hard to know who has a voting or majority stake in what. I think its interesting that Ebay tried to mock Craigslist when, as you said, Craigslist is so small.
Yea, it was really interesting. Just to know the way Ebay was thinking before even buying in Craigslist stake. The way they tried to eliminate Craigslist share of the classified online business profit is a masterpiece. I want to know how will this trial going to end so I'm actually following up on that.
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