Exit Meg Whitman
At last, eBay CEO Meg Whitman is preparing to leave, the Wall Street Journal reports. It's about time, and even Whitman would agree, having said that no one should stay CEO of a company for more than 10 years. That deadline comes in March, and Tuesday's earnings call are as good a time to tell shareholders as any. Her likely replacement, John Donahoe, won't be much of a change: If he is tapped as CEO, power will be ceremoniously transferred one ex-management consultant to another. Is it any wonder eBay is bleeding risktakers and creative talent?
Whitman's reign can be roughly divided into two parts: 1998-2005, and 2005-2008. Her first seven years were lucky indeed. eBay was one of the few companies to weather the bust well. Its purchase of PayPal in 2002 turbocharged its growth, allowing it to extract fees from sellers not only when they sold their goods, but also when they collected the money.
But since then — a period which coincides with Donahoe's tenure at the company — eBay has struggled. Google's inexpensive search adsincreasingly provided a new kind of competition; while Whitman fumbled around trying to respond to that threat, Jeff Bezos lured away some of her top merchants to a revitalized Amazon.com. In most of Asia, eBay still has little market share. And buying Skype, as many predicted from the start, proved a costly distraction.
A revision to Whitman's Law: CEOs should only stay seven years, max. With all the troubles Donahoe has either inherited from Whitman, or made from himself, he'll be lucky to stay half that long.