EBay Buys Mobile App Developer Critical Path Software

EBay

E-commerce giant eBay (NSDQ: EBAY) today doubled-down on its mobile ambitions: the company announced that it has bought Critical Path Software, the Portland, Oregon-based developer that was behind eBay’s own iPhone mobile apps and those of several of its subsidiaries. The deal will increase eBay’s mobile staff twofold. Financial terms of the deal were not disclosed.

The acquisition comes on the heels of a record-breaking year for eBay on mobile: The company expects to make $1.5 billion in mobile across all of its assets in 2010, compared to $600 million in 2009.

It’s also witnessed some milestones in the current shopping season: for the second Sunday of December — dubbed “mobile Sunday” — eBay reported a 127 percent increase in “gross merchandise volume” on mobile to nearly $5 million; worldwide the rise was even sharper, growing 165 percent to $13 million. EBay said also that year-on-year mobile sales increased 146 percent during Cyber Monday.

Among the sites that Critical Path Software has developed for eBay are the eBay for iPhone app, as well as the iPhone apps for StubHub, eBay Classifieds and Shopping.com iPhone applications.

That means that bringing the startup in-house will be a continuation of an existing relationship, rather than an integration or bolting on of a startup from left-field, which can often prove to be an awkward fit when giant companies acquire small startups — and in fact proved to be a disaster for eBay when it acquired Skype.

“We’re very serious about innovating in mobile commerce, and this acquisition underscores our commitment to bringing the very best and brightest in the field to eBay,” said Mark Carges, chief technology officer and senior vice president, global products, eBay Marketplace, in the official release for the announcement.

The Critical Path Software team will remain in Oregon, headed up by its founder, Steve Romero. It will report to Steve Yankovich, eBay’s VP of mobile.

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