eBay Set to Outline Its Future, and It Looks Nothing Like Amazon

For the past decade, eBay and Amazon have been considered two of the most dominant e-commerce companies, but it is becoming increasingly clear that the two are headed down entirely different paths.

At eBay’s developer conference, kicking off Wednesday in San Francisco, more than 4,000 developers and merchants will receive a preview of X.commerce, the company’s new technology platform aimed at developers.

The nonconsumer-focused platform will enable developers to use the tools to build applications for retailers who are looking to have a larger presence on social networks, online and on mobile phones.

Also on stage will be some of eBay’s new partners, including Omniture, Adobe’s marketing and advertising unit, and Katie Mitic, the director of platform and mobile marketing at Facebook.

Mitic, who recently joined eBay’s board, is expected to announce a partnership between the social network and eBay.

The X.commerce division will draw from many of eBay’s existing technologies, including PayPal, but will also tie together several other acquisitions, including Milo, which has created an online database of offline inventory in physical stores; Red Laser, which is a barcode scanning technology; and Magento, which assists in the creation of online storefronts.

In essence, eBay is looking to partner with physical retailers to generate more sales online or by driving more foot traffic to their stores.

That’s in steep contrast to Amazon, which has increasingly focused on driving more and more spending online. It also has focused on the digital distribution of content, such as books, music and video, and is placing a huge bet on hardware, like the upcoming Kindle Fire, hoping to rival Apple’s iPad.

The opportunity still exists for many to grab even just a small percentage of local commerce — regardless of whether it’s through third-party developers or driving more spending online. That’s because e-commerce today makes up only a small fraction of spending, with the bulk of purchases continuing to occur at physical retail locations.

The X.commerce group in eBay joins three other major groups, including the eBay marketplace, PayPal and GSI, which it acquired earlier this year.

X.commerce is eBay’s biggest move to date in becoming a back-end technology provider rather than a consumer-facing brand. The service it builds will be aimed at developers, who will in turn own the relationship with the merchants.

Take eBay’s Red Laser technology as an example. If a merchant creates an application using the technology, a consumer will be able to scan a barcode in the store, and then find out if the item is in stock. The consumer will then have the option of buying it using PayPal directly on the phone without ever leaving the application.

The most consumer-facing element being unveiled tomorrow is what eBay is calling PayPal Access, which will enable online shoppers to log in to a Web site to buy something using their PayPal account, rather than having to create a brand-new account. By using PayPal, the consumer’s shipping address and billing information will automatically populate the store, saving a few tedious steps. PayPal Access will become available to consumers as online merchants adopt it.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik