eBay buys out Magento, initial thoughts

Interesting developments from LA over the last day or so, with the announcement that eBay are to buy out Magento. There is limited information available at the minute, the best source being the Magento blog. But with the eBay deal with GSI commerce as well, I for one will be looking out for further announcements shortly, which may shed further light on the impact of these transactions on both Magento and Intershop (of which GSI have a major stake).

Although the transaction is exciting news for Magento, it will be important for them not to forget the fundamentals of the product – it’s not just about features and functions, if eBay are looking to use the product as a major part of their x.commerce strategy – performance, security and support will be key service points that need to be maintained and enhanced. However, the statement provided by eBay on their website X. Commerce, suggests a major cloud based solution is on the cards.

This would be a radical move, leaving a clear line of distinction between vendors offering traditional CPU license based models, and those offering the cloud approach. As we’ve seen in recent months the cloud can provide excellent performance, but if your business model is totally dependent on the availability of internet service, it is removing an element of control from a business, as the service failure at EC2 showed. We at KPMG Crimsonwing are fans of the cloud, but for many more traditional IT departments, it could put a clear dividing line in their platform selection process.

I’m sure we’ll be posting more on this subject shortly, but according to istock analysts we may have to wait until October to be sure.