e-commerce to be $1bn biz in India by 2013: eBay

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eBay wants to change the popular perception of being just an e-auction site and make the most of the fast-developing Indian e-commerce market.

In an interview with CNBC-TV18's President & Editorial Director of TV18 Business Media, Senthil Chengalvarayan, eBay's President & CEO John Donahoe spoke about the company's India plans.

Below is a verbatim transcript of the interview. Also watch the accompanying video.

Q: eBay is synonymous with online marketing, online auction, but you are really more than that; you are into telephony, you are into payment solutions with PayPal, you have got Skype, you have got a ticket exchange through StarHub, you have got number of classifieds sites across the world. So, what are the various consumer touch points that you like to be in to feel connected?

A: eBay is about connecting buyers and sellers.  eBay, market place was the first way we connect buyers and sellers and ten years ago that was the only way to connect buyers and sellers online.

Q: You think the telephone is something to connect with buyers and sellers.

A: Payments is the way to connect buyers and sellers. We actually we have sold 70% of our stake in Skype simply because I didn't see synergy in that business. So, today we have got two core businesses; eBay, our core e-commerce site and PayPal, our core payment site.

Q: Any other touch points you like to be in or you think you need to be in?

A: I think with e-commerce it's going to be multiple ways to connect buyers and sellers. You mentioned StubHub which is a ticket exchange in United Stated, our classifieds.  We have numerous classifieds sites around the world.

What we want to do is offer consumers choice to buy in a format they want from the seller they want. We want to offer sellers choice to sell in the format they want to the consumers they want.

Q: Are you in India little too early? I will tell you why I am asking you this because if you look at the Alexa rating for traffic onto the internet, in the US you are number nine and I think Amazon is five. But look at India, we have got Big Bazaar, which is India's largest retailers, with 860 or something, Shoppers Stop, which is 1,800 so the big brick-and-mortar boys in India seems to be saying it's great fun out there but we would rather be down here, investing in where the real money is. So, are they getting it wrong or are you too early?

A: I do not think we are too early. I am very bullish on e-commerce in India. I think India is still in its early days and the Indian e-commerce market growing at 30% a year. eBay's business is growing 60% a year. So I am certainly not feeling we are too early. We have got 2.5 million registered users now and I think the Indian e-commerce market can experience significant growth over the next three-five years as 3G comes online, as broadband gets more ubiquitous.

Q: How do you see it evolving because at the moment I think 60% of online transactions are tickets; railway tickets, aeroplane tickets? Is that similar to any other emerging market around the world, how do you see this emerging?

A: I think what you are going to see here in India is with more people having access to the internet through their mobile devices or through broadband, you are going to see changes in consumer behaviour in terms of willingness and an ability to buy online.

Q: Is there any emerging market that you like to compare us with or is it too newer business to draw compare with somewhere else?

A: I was with our India team today and what I said to them is I want other emerging markets to be comparing themselves to India because I think India will be a resource of innovation and Indian consumers are very demanding consumers. So, whether it's through mobile commerce or through other ways to connect with buyers and sellers and the way things could be delivered, I expect India to be resource of innovation in e-commerce in the next three-five years.

Q: Before we look ahead, what's been the biggest challenge that you faced in India and what is the biggest challenge you think is holding e-commerce back?

A: I think internet access. If you can't access the internet and you can't access with respect to high speed it makes it harder.