eBay Takes On Amazon discussion

Visit and explore the websites of eBayGSI Commerce, and Amazon.com. Read the required Steigrad article.  Respond to the following:
a. Consider the article’s statement, “The deal will take eBay one step further away from its decelerating auction model while strengthening the company’s fulfillment and customer service operations, two of Amazon’s strengths.”
• Why might eBay’s auction model be “decelerating”?
• How will the acquisition of GSI “strengthen eBay’s fulfillment and customer service operations”?
b. Was the acquisition of GSI a complementary or supplementary fit into eBay’s strategic portfolio of products?  Why?
c. According to the article, analysts estimated Amazon’s 2010 revenues to be $44.93 billion, while eBay’s was only $10.47 billion.  How effective might this acquisition be to achieve the goal of “chipping away at rival Amazon.com Inc.’s lofty online retailing business.”
d. Was this acquisition a good strategic decision?  Why or why not?
Explain your rationale.  Respond to at least two of your classmates’ postings. 


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