Will eBay's Stubhub Give Ticketmaster Trouble?
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So you went online and bought a ticket for an event at a venue you've never been to before. Sure, you looked at a color-coded map of the stadium, concert hall, or theater online you're visiting, but we all know you won't really know what you got until show up the day of the event.
Today, eBay can relate. Yesterday, eBay announced it agreed to pay an estimated $310 million for StubHub, the San Francisco-based online marketplace for tickets launched in 2000.
"It's a perfect complement to eBay's tickets business," eBay North America Marketplaces president Bill Cobb said in a statement.
But only today will the company take a seat as the new owner of the once privately held firm and finds out what it really got.
So what's the verdict? Does eBay have a pillar in its face or does its new property provide a clear line of sight? What, exactly, is eBay getting in the mail?
At the time of writing, eBay's stock had moved up nearly 4 percent on the day and early analysis suggests that the company bought a helpful complement to its growing ticket business.
"Stubhub has proven to be a leader and its certainly an augmentation for eBay," JupiterResearch's senior analyst for the retail industry Patti Freeman Evans told internetnews.com. Evans said that after integration, Stubhub's business should improve under eBay's watch. She said eBay's marketing expertise will bring new traffic and its technical expertise will improve the shopping experience for users.
The flood of eBay cash and knowledge is bad news for some of Stubhub's current rivals. "For the other, independent secondary market ticket sellers, this will be a challenge," Evans said.
IAC/InterActivCorp property and market leader Ticketmaster.com need not worry, however. Ticketmaster has long established relationships with the venues themselves, Evans said, and that gives it a huge advantage in terms of the primary marketplace.