April 24, 2006

Back in September, in my first reaction to the talk of Ebay-Skype deal I wrote that Ebay is nervous because it perceives Google as a looming threat and that this could be one of the reasons behind its move to diversify by acquiring Skype.
...until a few months ago, Ebay was the largest internet pure play business around. At around $55 billion in market cap Ebay is three times the size of Amazon and significantly larger than Yahoo. Now, all of a sudden here comes Google and before Whitman could even blink it races past Ebay to reach over $80 billion in market cap. Now that Google is poised to launch an online payment mechanism, possibly threatening Paypal (even though Google denies they would compete) - it makes eBay all the more insecure.

This was when everyone thought the deal was to integrate Skype in the auction business and wondered whether there is any synergy between the two companies. Now Wall Street Journal reports that Ebay is talking to Yahoo and Microsoft (both arch rivals of Google) on how to combat the growing threat from Google.
"After years of working closely with the search giant, eBay last year became alarmed as Google started assaulting its turf in multiple ways," the report said, including creation of a competing classified advertising service.

Related links:

Reuters: Ebay in talks to fend off Google threat: report
My original post: Ebay Wants to Buy Skype? Makes Sense

Follow up posts on Ebay-Skype deal:
Skype Valuation: Why it Deserves to be High
Why Ebay Bought Skype
Skype's Revenues and The VoIP Opportunity

Will BootCamp Hurt Software Development for Mac?

BootCamp is perhaps the best thing that has happened to Apple ever since their fateful decision in the 80's not to license the Mac OS. A remarkable feat for the company and a treat for the consumers. Sure, we all get that. But there's an obvious consequence of the Windows-Mac marriage that's not being discussed as much.

Now that every Windows software can be easily accessed over the Mac, why should software vendors develop dedicated Mac versions of the same applications? I'm sure a few companies that understand the value of the unique Mac user experience will continue to do it but many others might just give up. After all, it's a lot of work to start from scratch for a platform that is not as widely distributed. The argument that Mac users will be deprived from using the software is no longer valid.

So as companies decide to skip developing Mac versions of their software in view of BootCamp, it has got to hurt Apple in some way. Right?

Not really. In the long term Apple's decision to allow Windows might still play out in their favor. Here's why. If BootCamp and other new ways of marrying windows with Mac turn out to be hugely successful in making people switch, Mac's market share would grow so big that it would be impossible to ignore the platform. Users would refuse to put up with the inferior Windows user experience and demand they get it over the Mac. That's the power of the user experience.

That's also a terrific gamble by Steve Jobs. But any way you look at it Apple seems poised to achieve truly big things. I'd be buying Apple's stock now if I could. For some reason Wall Street analysts have a "hold" rating on Apple. Even the stock hasn't risen as much since the BootCamp news as it should, considering how big this is going to be. Perfect time to invest in Apple.

Related stories:

Motleyfool: A tipping point for Apple
NewsWeek: Win on Mac: A Sign of the Apocalypse?
BusinessWeek: 50% of new Mac buyers are switchers
Robert Cringely: Windows app might run natively on Mac
The Inquirer: Macbook Pro now pre-loaded with Windows
InfiniteLoop: Adobe promises to continue with Mac versions
Sci-Tech today: Microsoft's Worst Nightmare
Macnn: Needham maintains "hold" on AAPL

My previous posts on Apple:

Smithsonian Interview of Steve Jobs from 1995
Lesson from Jobs' life
On Apple's decision to partner with HP
On Jef Raskin
Unveiling of iPod Nano
Apple's User Experience advantage