New look

Just testing out a new look for the old blog. I will get around to customizing what ever template I finally select... but for now I am just trying out some of the standard templates to see how they integrate with adsense.

eBay - "Network Effect Managers"

There are about 1 zillion articles on the Skype / eBay merger. Rather than pick apart the deal from a strategic, operational or valuation perspective, I want to make a point about eBay the company.

It is clear that for eBay to succeed they need to do one thing better than anyone else in the world, and that is manage network effect businesses. Each of their three businesses (eBay, PayPal, Skype) are built on network effects that drive growth... but the scary thing about network effects is that as easily as they build up, they can collapse (see Friendster). It won't be enough to simply manage each network effect independently, to be truly successful eBay must find ways for each network to feed the other networks of the business... creating synergies where 1 + 1 + 1 = 6. This won't be an easy task... anyone familiar with network effect businesses will tell you they are complex systems which must be analyzed quantitatively as well as nurtured (remember the backlash when eBay raised fees). Now imagine managing 3 interconnected network effect businesses!

I almost wonder if every employee at eBay should be given a secondary job title of "Network Effect Manager"