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eBay Mulls Layoffs to Position Marketplace as Takeover Target?

eBay Marketplaces may lay off thousands of employees next year thanks to the pending breakup with PayPal. That according to the Wall Street Journal on Wednesday which cited “people familiar with the company’s thinking.”

“The planned layoffs appear to be part of eBay’s preparations to be a stand-alone company, and a potentially attractive takeover target,” the newspaper wrote.

Since the announcement of the breakup, which Carl Icahn had been urging the company to do since January, there has been speculation that the board might line up a suitor for the eBay side of the business – and much of the speculation focused on China’s Alibaba.

“Analysts have said an independent eBay would be a candidate for a buyout, and job cuts would help lower operating costs, a key metric for buyout firms,” the Wall Street Journal wrote, but it seemed to have no new information, and said “a spokesman declined to comment on the company’s plans for job cuts.”

A tech blog speculated current eBay CEO John Donahoe would serve on the PayPal board after the breakup, and not on the eBay board. Donahoe had said he would serve on one or both of the boards after the breakup.

It’s not clear what prompted the speculation today about factors that look unfavorable for the marketplace side of the eBay business.

We’ve reported on the incredibly long hold times users are experiencing when trying to reach eBay customer serice. One eBay seller wrote to EcommerceBytes this afternoon, “Waits to reach customer service are intolerably long now due to past reductions, imagine how long it is going to take when eBay trims more staff.”

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). She is a member of the Online News Association (Sep 2005 - present) and Investigative Reporters and Editors (Mar 2006 - present). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.