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Job cuts at eBay will affect La Vista PayPal office
(Omaha World-Herald (NE) Via Acquire Media NewsEdge) Oct. 6--Internet marketer eBay said Monday it would cut about 1,000 of its 10,000 employees, not fill job openings and terminate some part-time and contract workers to streamline its business and reduce costs.
The cuts will eliminate an unspecified number of customer service jobs at eBay's PayPal call center in La Vista, which employs about 3,000 people.
While the overall full-time employee reduction is 10 percent, eBay is not saying how many jobs will be cut in La Vista or at other divisions, PayPal spokeswoman Sara Gorman said from Atlanta.
"Our big focus is the customer experience," Gorman said. "The jobs in Omaha are a big part of that. PayPal continues to be committed to Omaha and our operations there."
The job cuts will cost about $70 million to $80 million for severance pay and other expenses but save about $150 million a year in salaries, eBay said.
eBay also said it plans to acquire an online credit company, Bill Me Later, for $945 million and combine its operations with PayPal. The company also said it would pay $390 million for two classified advertising Web sites based in Denmark.
PayPal is the No. 1 online payments business. Bill Me Later is No. 2. They are expected to be combined by the end of the year.
John Donahoe, eBay's chief executive, said the two would complement each other and benefit consumers and merchants, with Bill Me Later offering deferred payment plans and promotional financing to customers who use eBay and PayPal.
"We're going to continue to invest in PayPal to extend that leadership position, because we think it has enormous potential, and almost a once-in-a-lifetime opportunity to extend that lead," Donahoe said during a conference call.
PayPal President Scott Thompson would oversee the combined business, with Gary Marino, chief executive of Bill Me Later, running that unit and reporting to Thompson.
Bill Me Later was founded in 2000 . Its headquarters is in Timonium, Md., and it has operations in Hunt Valley, Md., and San Francisco.
EBay said its revenue for the latest three-month period would be "at the low end" of its earlier forecast, although profits would be higher. Its stock price dropped $1.05, or about 5.5 percent, closing Monday at $17.89 per share.
To see more of the Omaha World-Herald, or to subscribe to the newspaper, go to http://www.omaha.com.
Copyright (c) 2008, Omaha World-Herald, Neb.
Distributed by McClatchy-Tribune Information Services.
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