Google and Ebay are set to announce Monday a partnership that links the fortunes of the online giants at a time when their strategies had threatened to put them increasingly on a collision course.
The two companies are in direct competition — in areas like online phone service, payment and product listings.
eBay signed a partnership in May with Yahoo to display ads on domestic pages. The alliance was seen as a way to counter the growing power of Google.
Google is the leader in selling text advertisements on the Internet. If Yahoo is better in US, it not as strong as Google on the rest of the world. This was the reason eBay chose Google to represent it abroad.
“Google is very strong in every country outside of the United States,” said Meg Whitman, eBay’s chief executive, in an interview Sunday night. “We felt this arrangement of assets made sense.”
Also, the companies announced a non-exclusive worldwide “click-to-call” advertising agreement under which they will carry their respective voice services – Ebay’s Skype and Google Talk – on each other’s shopping and search pages. Click-to-call adverts create an online voice connection between a web user and advertiser.
Eric Schmidt, chief executive officer of Google, said the latest alliance “underscores how much we value Ebay as a partner”.
The two companies already have one close tie, in that Ebay, alongside Amazon.com, is thought to be one of the two biggest buyers of keyword advertising on Google’s search engine.
“We’re pleased to expand our long-standing relationship with Google to explore new market opportunities, like click-to-call advertising, that benefit both our communities of users,” said Meg Whitman. “People continue to evolve how they shop, communicate and advertise online. By combining the power of eBay in ecommerce and Skype in communications with Google’s leadership in search and advertising, we can increase the usefulness of the Internet for shoppers, merchants and advertisers around the world.”
Google is one fierce competitor for eBay because it has a lot of services that match the ones from eBay. Google Base lists products for sale; Google Checkout competes in some ways with eBay’s PayPal; and Google Talk is an alternative to eBay’s Skype online phone service.
The agreement to supply ads to Ebay’s international sites is the latest in a string of important partnerships for Google, following similar deals with AOL and MySpace.
Starting in the near future, Skype will offer its users the option to download the Google Toolbar, to which Skype will add a custom button. The companies will also explore interoperability between Skype and Google Talk via open standards to enable text chat and online presence.