Youssef Squali - Jefferies & Company

Thank you very much. Okay, so my one question. John, if I look at the sum of the parts for eBay, the stock certainly looks pretty cheap on that basis. The only issue is really kind of remains a theoretical exercise, unless management gives it serious consideration and is willing to act on it. Are you and how long would you wait before considering a potential restructuring of the business as the core continues to weaken? Thanks.

John J. Donahoe

We are continuing to, as I said, invest in our areas of strength and we see strong synergies between the core eBay business and the PayPal business, and strong synergies between the eBay business and the other e-commerce formats and I get a question frequently on PayPal of wouldn’t we be better off with PayPal being separate? Our sense is no, that actually there are strong synergies between PayPal and eBay, that eBay continues to provide PayPal with new customers, that there is still growth for PayPal left on eBay. As we said, we are delighted penetration grew more in the third quarter than it has any quarter in the past. It’s now at 60% globally. We think that can go higher and there’s nothing about being part of our portfolio that is holding PayPal back, in fact, quite the contrary; being part of the overall portfolio allows us to move on an acquisition and opportunity like Bill Me Later. So we are focused on trying to take advantage of the synergies. We don’t think we’ve fully realized the synergies between eBay and PayPal and that our classifieds business, advertising, and Stub Hub all have strong synergies with eBay.

The one question on Skype. Skype I think is a great standalone business. Obviously the more we let it stand alone, the more it seems to deliver fantastic results. Right now it’s not a distraction and we are focusing our attention on eBay and PayPal and the e-commerce businesses and so we will continue to assess its role in the portfolio but right now it’s not a distraction and it’s delivering good results.

Mark Rowen

Next question please.

Operator

Our next question comes from Christa Quarles with Thomas Weisel Partners.

Christa Quarles - Thomas Weisel Partners

Hi. Just following up on the PayPal slowdown, it looks like international in particular fell off fairly significantly in the quarter. I was wondering if you could give us some deeper insights in there in terms of which markets you are seeing strengthen, if that’s really reflective of what’s going on with the broader e-commerce market in those areas. And then also if you could just update us on your G-market intentions -- the filing suggests that you are intending to get more than 50% of G-market and so I was just wondering if you could follow-up on that. Thanks.

Robert H. Swan

First on the PayPal slowdown, yeah, we saw some deceleration or more deceleration I should say outside the U.S., a function of a couple of things -- one, Q2 to Q3 currency. So with the stronger dollar, clearly international revenues are translating at a tougher rate. Two, the on-eBay business decelerated Q2 to Q3, along with the GMV deceleration. And then third, our global merchant services business, we saw some deceleration Q2 to Q3 both here in the U.S. and outside of the U.S.

In terms of G-market, let me -- maybe let me put our -- reiterate our M&A philosophy and focus and then maybe put Korea into context. First we’ve said that we are going to continue to maintain the flexibility to invest and grow our businesses through acquisition and we’ve highlighted three specific areas of focus -- one, geographic strengthening; two, adjacencies that leverage and strengthen our core businesses; and three, technologies that enable and strengthen our core businesses. That’s the three areas that we’ve been focused on over the last three years and that’s resulted in acquisitions like Stub Hub, which we feel great about; more recently, Fraud Sciences, which is a technology that enables PayPal, and then recently, Bill Me Later and DBA or classifieds, kind of extensions of our core business. So that’s been our M&A strategy for the last several years.

In terms of Korea, we’ve got a great business in Korea. Our IAC business has been performing very well over the last couple of quarters and we continue to focus on competing and growing in that market. Along the lines, we in conjunction with G-market had filed with the Korean regulators to assess whether it would even be possible to take an equity stake in G-market and recently got a favorable ruling in that regard and I think we’ll evaluate on an ongoing basis whether that makes sense in terms of the best uses of how we allocate capital in a disciplined way.

John J. Donahoe

Let me just come back and make one comment, Bob, on your first -- while there was a deceleration in the market and outside the U.S., PayPal''s international business was one of the things I think we are very excited about. We continue to see merchants adopting PayPal in Asia, across Europe, and even in Latin America and other places where we don’t have a strong eBay presence because it’s driving incremental growth and it’s opening up a worldwide, a global marketplace for those merchants. In fact, TPV outside the U.S. was up 37% for the quarter and the merchant services international growth was close to 50%. So, the economy is impacting I think the whole world but the core value proposition PayPal delivers to merchants around the world as a global payment platform is one that we continue to think is quite powerful and merchants are responding to.

Mark Rowen

Next question please.

Operator