eBay: Time to let go of a lucrative past

It’s about time for eBay to reveal its fourth quarter income, revenues and all that to investors, and no one is expecting anything but bad news. The company’s revenue, despite increasing competition from every angle, has grown for ten years straight, but it looks like that simply wasn’t sustainable lately, and they’re going to post a decline in income. eBay is philosophical about it, however, and knew that it was coming, so hopefully their investors are prepared (or have left already).

This last year has been eBay dealing with the fact that it may have essentially peaked in usage, or at least gotten as big as it’s going to get for now without major changes. The number of actual items sold has dropped year-over-year by as much as 10%, which is a big hit.

The cognitive scientist in me says that in times of scarcity, people are more likely to go with the sure thing — in etailers that would be Amazon — and avoid the “gamble,” which is eBay. It’s unpredictable by nature, even if it’s all according to a system. eBay will get their groove back, but keeping expectations low is probably a good idea.