eBay Puts Magento In The Cart For Its X.Commerce Platform

Leading open source e-commerce builder will anchor eBay's open source commerce platform

eBay announced today that they are acquiring the leading open source e-commerce platform, Magento. Magento will serve as a key component of eBays new open commerce platform, X.commerce.  Terms of the acquisition where not announced, but eBay already owned a minority stake in the company since 2010. Combined with PayPal which eBay already owns and eBays existing auction and commerce technology, the Magento platform can give eBay a complete and deep e-commerce offering for merchants.

I wrote about Magento back in March of 2010. At the time I was blown away by the ability of the open source e-commerce platform to give merchants the ability to create an "Amazon experience" for their customers. The Magento platform is a seasoned and feature rich product with a dazzying array of options available.  From the smallest mom and pops to the largest retailers, Magento has what you need to create a top flight web shopping destination. 

Now I would imagine you will have a very tight PayPal integration (it already worked with PayPal I believe) as well as perhaps improved ability to run different type of auction type of commerce. Of course you could already do some of that type of stuff with Magento before the acquisition. 

For now details on the future of Magento besides being part of this new open source platform group are vague. It appears the team will stay put in LA, but really reading and listening to the various posts and interviews, I am not sure all of that is worked out yet.

What is more intriguing is what this new X.commerce, open source commerce platform is all about.  eBay CEO John Donahoe refered to it in the video message he did around the acquisition announcement.  There will be a developer conference for X.commerce in October where more details will be made available.  Donahoe's message is below:

The CEO of Magento, Roy Rubin also put his thoughts on the acquisition to words on the Magento blog and recorded a video (is doing a YouTube on the deal now expected of CEOs?)

Of course eBay itself already has a big developer community around it. People who develop add ons and stores for eBay merchants and integrate into eBay. Offering eBay merchants the ability to quickly create a Magento store could be seen as competitive to them. But if the platform is going to be open, I imagine that everyone will get a change to use the code to create the best solutions for the market.

In the meantime, no matter the exact amount eBay paid, Magento would seem to represent another commercially successful open source project that returned money to its investors. While not every open source company will be the next Red Hat (maybe none of them will), successful exits and acquisitions are a sign of a healthy open source ecosystem and business model. 

Congratulations to the Magento team and we will be looking closely for news on the X.commerce platform

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Copyright © 2011 IDG Communications, Inc.

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