Wednesday, March 14, 2007


This article encapsulates some of the reasons to buy Ebay, which I did recently at $31.

In addition to the Forbes logic, consider:

-Skype is looking like a money maker. My decision to buy coincided with reading that they're at something like $.01 in revenue per user. I see no reason why that figure can't grow. (I'm one of the $29.95 USA plan users, and expect many more to join.)

-Ebay has no strong rival in any of it's markets (online auctions, online payments, etc.)

-while critics say that online auction growth is decelerating, Ebay has adeptly bought add-ons to this core business (like StubHub) to keep the growth going.

-Ebay's economic model is still the best on the planet. As growth continues, margins INCREASE, as the marginal cost of hosting more auctions is basically a fraction of a server and connectivity - no new people, nor software costs, nor shipping costs.

-Along the same lines, you can think of Ebay as not being an auction-specialist, but rather a specialist in infinitely scalable, low marginal cost businesses.

-Ebay's management team, and especially CEO Meg Whitman, are now 'net veterans and I think, for having managed Ebay thru the good times and the bad, can now be acknowledged as the cream of the crop of internet business managers. (It won't surprise me if Ebay will (or has already) become to Internet business like P & G is to marketing- the place where great managers come from.)

Wednesday, March 07, 2007

Beware Hollywood good intentions

Great story tee'd up by Marginal Revolution. Turns out that one recent celeb-driven charity campaign was actually more intent on promoting the celebs, than impacting those in need. The RED campaign against AIDS has apparently spent ~$100M in advertising to raise $18M.

This isn't entirely fair, as much of the advertising spend was really just reallocated to promote a tie to RED, but still, the results are suspect.

This isn't the first or last time charity has been leveraged to commercial advantage. I might be off on my numbers, but Miller Beer one time spent $500,000 promoting it's decision to give away $50,000 in scholarships.

With my new friends on the Great Wall of China

With my new friends on the Great Wall of China
Click to go to my online photography

World sun clock

Uncommon Man's Creed

"I do not choose to be a common man. It is my right to be uncommon -- if I can. I seek opportunity -- not security. I do not wish to be a kept citizen, humbled and dulled by having the state look after me. I wish to take the calculated risk; to dream and to build, to fail and to succeed. I refuse to barter incentive for a dole, I prefer the challenges of life to the guaranteed existence; the thrill of fulfillment to the stale calm of utopia. I will not trade freedom for beneficence, nor my dignity for a handout. I will never cower before any master, nor bend to any threat. It is my heritage to stand erect, proud, and unafraid, to think and act for myself, to enjoy the benefit of my creations, and to face the world boldly and say, "this I have done." All this is what it means to be an American." -- Anonymous