Rumor: StumbleUpon To Be Acquired By eBay

    April 19, 2007

Reports surfacing about a possible eBay/StumbleUpon deal have created quite a buzz throughout the blogosphere over the last 24 hours. Forsaking the significance that such a deal could have in the silently mounting animosity between Google and eBay, the rumored details of acquisition weave an interesting tale in and of themselves.

Headlines on the acquisition front have, by in large, been dominated by Google over the last six months, starting with the company’s highly publicized and now much scrutinized purchase of YouTube.

eBay, however, has silently been building its empire with purchases of its own, and it appears StumbleUpon will be the newest piece of the puzzle for the online auction powerhouse.

TechCrunch’s Michael Arrington gives preliminary details on the agreement:

High-flying startup StumbleUpon has been rumored to be in acquisition discussions since at least last November. Recently we’ve heard that talks have heated up again, with Google, AOL and eBay as potential suitors. A source with knowledge of the deal now says the company has signed a term sheet with eBay to be acquired.

What specific plans does eBay have for StumbleUpon? Om Malik speculates:

By marrying the toolbar to Skype client, eBay can do an end run around Google’s dominance of the search business. A simple search box inside Skype client is all it would take. It is not that far fetched: Skype has been slowly integrating various different services (including PayPal) into its client, and slowly becoming eBay’s desktop backdoor.

Much has been made of Google’s success in expanding its brand beyond search and into other online avenues while eBay has mostly had the luxury of operating under the radar, which no doubt suits the top brass at eBay just fine.

Make no mistake, however; eBay is a force to be reckoned with. The company just reported a 52 percent quarterly profit increase, with a total revenues jumping at a 27 percent clip. The eBay brand is just beginning to realize its full potential, and Google should be very worried about the sleeping giant that’s about to awaken.