eBay CEO labels drone delivery of products a fantasy

By Nicel Jane Avellana

Dec 06, 2013 09:39 PM EST

John Donahoe, the Chief Executive Officer of eBay Inc, called product delivery using drones a fantasy in an interview with Emily Chang on Bloomberg Television today. Responding to Chang's question if he would be showing her a drone, Donahoe responded, "We're not really focusing on long-term fantasies. We're working on things that will change consumers' experiences today."

This week, eBay Inc's rival Amazon.com Inc unveiled plans to have drones deliver small packages. Currently in its testing stage, Amazon Chief Executive Officer Jeff Bezos expects the drone project to become a reality in five years. Amazon said their drones would fly directly to the houses of customers, guided by GPS coordinates, and deliver small goods like food and books. However, a Bloomberg report said the initiative from the world's biggest ecommerce firm has been met with resistance from regulators. Couriers were also dubious about the idea.

In their quest to get the competitive advantage, ecommerce firms like Amazon, eBay and Google Inc, are racing to deliver products faster to their customers. Amazon has initiated an unlimited two-day delivery service for its Prime program that costs USD 79 annually. Meanwhile, eBay has stepped up and started eBay Now which pledged one-hour delivery.

Donahoe told Chang that eBay was intent on commerce innovations, citing as examples its touchscreen storefronts and faster delivery through eBay Now as examples. He said, "Bold innovation is important, but our focus on our bold innovation is around commerce. So the notion of making a storefront window a touchscreen, I'd call that a bold innovation. By having those moonshots be very focused in our area of competence, they can grow to be important businesses."

Another example of out-of-the-box thinking employed by eBay that has generated returns is its push for mobile commerce, Donahoe said. From a combined mobile payment volume of USD 27 billion last year from eBay and PayPal, the figure will go over USD 20 billion for 2013 for each company.

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