Stay on Top of Enterprise Technology Trends Get updates impacting your industry from our GigaOm Research Community

Nearly five years into a steady buying binge, eBay (s ebay) is looking bloated, unfocused and schizophrenic. eBay owns well over 100 subsidiaries, some of which were built in-house. But many are acquisitions that have been crammed into the parent company like those Tokyo train conductors at rush hour.

And where has it all left eBay? In a blur. eBay is an auction site painfully morphing into a direct sales site, with an online payment system that supports the e-commerce sites if you push it hard enough, a bunch of scattered classified sites, one that sells tickets, one that finds apartment rentals, and a software that lets you make phone calls online.

Got that?

It’s the same mistake Barry Diller made with IAC (s iaci): Lash together a bunch of intriguing e-commerce models and hope they gel. But they never do. And so you end up spending money on building a bunch of not-quite-related brands, only without much return because none of them really stand out.

After buying Skype in 2005, then-CEO Meg Whitman said the deal put eBay at the intersection of e-commerce and communication. Three years later, it still isn’t clear what that means. eBay sellers, for example, didn’t want buyers making free, time-eating calls to discuss their orders. Skype has since grown, but what exactly is it doing in eBay? How is Rent.com helping Stubhub, or PayPal helping Kijiji? What are MeetUp and StumbleUpon doing in there at all? If there’s synergy at work, it’s awfully weak.

Diller finally realized he’d have to spin off IAC into several companies, and it’s time eBay consider the same. John Donahoe, eBay’s current CEO, said last month, “We have a powerful portfolio; one that, I frankly believe, is not fully credited in the value of the company.” He’s absolutely right. In fact, the value of the portfolio pieces would be more apparent if the portfolio was broken up.

Not all the recent acquisitions have been misfits. Some of them, like last year’s purchases of Fraud Sciences for $169 million and Bill Me Later for $820 million, both of which are being rolled into PayPal, made good sense (although it’s too bad eBay didn’t wait a little longer to get better prices).

Others need to be sold off or spun out. Om has discussed the merits of spinning off Skype. Stubhub.com would be more at home at Ticketmaster (s tktm), and a company like Microsoft (s msft) could make good use of StumbleUpon. But these companies, like everyone else, are in no mood to buy, so well-timed spin-offs may be the best option.

The stock market is still volatile, and likely to slump further in coming months. But breaking up eBay once it’s stabilized could leave the company with large ownership stakes in entities that are doing well even in the downturn. Stubhub’s revenue rose 54 percent last year, and classified revenue was up 57 percent (48 percent in the last quarter).

There is one way that these Balkanized subsidiaries help eBay right now — they shore up the shrinking revenue on the flagship e-commerce site, which fell 18 percent last quarter from the year-ago period. Meanwhile, revenue rose 12 percent at PayPal and 26 percent at Skype.

eBay’s shopping spree over the last several years has masked slowing growth (and now declining revenue) at the original auction and e-commerce site. So it’s clinging onto healthier business units like a life raft — but it’s also holding many of them back from their potential.