Ten percent of Ebay staff may not have such a merry Christmas this year as the company could axe them in a move to separate their Paypal and Ebay business operations.
According Reuters, this highlights the retardation of the company’s growth in the marketplace.
Ebay was established by Peter Omidyar in 1995, an Iranian-American who started the site as a personal hobby. Shortly after starting to charge a service fee for transactions in order to pay his new $250 per month ISP charge, his site began gaining unprecedented growth, which led to its public listing in September 1998, and ultimately the $23.65 billion of equity the company has today.
Like many companies that started ahead during the dot-com bubble, they exponentially grew in the 90’s, but as the market expanded, so did the amount of competitors. The company’s strong standing in the global market however is challenged by strong local competitors like Taoboa in China and BidorBuy in the growing online South African market. With other multinational e-commerce businesses and its subsidiaries like China-based Alibaba further infiltrating markets globally, Ebay has a lot to worry about.
A global slowdown in e-commerce sales is probably the biggest factor contributing to the multinational’s steady decline. However, for those who have followed the history of the company, this major potential layoff is no surprise.
In fact it pales in comparison to the 10,000 employees that were axed in 2008 when their revenue plummeted during the global economic decline.