eBay sets up mobile commerce push

E-marketplace vendor's decision to acquire mobile app developer, Critical Path Software, will put eBay in good stead over next few years as mobile commerce is expected to develop strongly, notes industry analyst.
Written by Kevin Kwang, Contributor

eBay's plans this week to buy over its erstwhile mobile app developer, Critical Path Software, will place the Web marketplace operator in a good position to take advantage of the growing mobile commerce industry.

Craig Skinner, senior consultant at Ovum, noted that Critical Path had been working with eBay over the past two years, producing the Internet vendor's mobile apps and Web portals such as StubHub, Shopping.com and eBay's Apple iPhone app. With this in mind, the analyst said, the acquisition was about "in-housing and integrating mobile development talent". Details of the merger were undisclosed.

Skinner explained: "Critical Path has been concentrated on [Apple] iOS development, and this will give eBay an opportunity to apply these development skills across other [mobile] platforms where their current mobile apps are not as well developed."

He added that the acquisition will stand eBay in good stead, as the mobile commerce industry is expected to continue developing strongly over the next few years. This growth is primarily because "technology is no longer the barrier" with today's fast, responsive 3G wireless networks and an abundance of highly functional mobile devices with easy-to-use interfaces, he said. To this end, mobile customers have become accustomed to making mobile purchases, particularly of apps as well as in-app content purchases, he noted.

Skinner predicted that the next growth area for mobile commerce will look at integrating mobile payment technology that can be used on-the-go. He cited shopping apps that allow users to scan the barcode of an item, make an online price comparison and complete the purchase using their mobile device, as an example of the next frontier for mobile commerce.

In a press statement, eBay said Critical Path's "proven development capabilities" will play an integral role in enabling the Internet company to accelerate improvements to its customers' mobile experience.

Mark Carges, CTO and senior vice president for global products at eBay Marketplaces, said in the release: "We're very serious about innovating in mobile commerce, and this acquisition underscores our commitment to bringing the very best and brightest in the field to eBay."

Carges added that integrating Critical Path into the wider organization will be a "big win" for mobile shoppers, with the promise to "make shopping and selling anywhere, anytime, for almost anything, even better".

ZDNet Asia's sister site, CNET News, earlier reported that the acquisition is one of several eBay made this year. In June, the Web vendor bought RedLaser, a developer of an iOS app that enables iPhones to scan barcodes to compare products and prices. eBay earlier in December also picked up Milo, a shopping service that ties online and offline shopping activities.

The company's subsidiary payment service provider, PayPal, had also identified the mobile commerce market as a growth area.

In a July interview, Laura Chambers, senior director of PayPal Mobile, told ZDNet Asia that the company had released its Mobile Payment Library application programming interface (API) to simplify payment processes for mobile users.

Chambers also pointed out that the Asia-Pacific region, in particular, is a market that PayPal wants to be heavily involved in. Citing figures from research firm Informa, she said the region accounted for US$24 billion of the global US$30 billion mobile commerce market in 2009. The region's contribution is expected to rise to US$139 billion in 2012.

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