Slashdot Mirror
EBay Mulling Skype Sale
MaineCoasts writes "The Financial Times reports that eBay's new CEO is evaluating a sale of Skype if new ways cannot be found for the fast-growing service to support its core e-commerce business. EBay reported earlier this week that Skype had a 61 percent increase in first-quarter revenue over the same quarter last year and now has 309 million users worldwide."
Is anybody surprised? Why Ebay bought them in the first place is beyond me. It made no sense.
eBay's interest in Skype never made much sense to me. Live voice auctions might have fit in, but seem rather impractical. It will be nice to have Skype ownership that has a vested interest in Skype's core business.
Let's get this straight. You have a thriving subsidiary with strong growth but it isn't sufficiently enmeshed with your core business to make you happy as the CEO or eBay. Your options are to:
It seems to me like this guy is looking to bail out on eBay in the next couple of years and wants to have a successful divestiture to feather his cap. This is typical of the sort of short sighted bullshit that publicly traded American companies go through nowadays because the overpaid people running them don't care about anything other than their own career track.
I am becoming gerund, destroyer of verbs.
It is not making too much money, it is making more money, it is growing, and it is better to sell something when it will look attractive to buyers. They over paid for skype, it takes a lot of resources to run, and has nothing to do with their core business. Getting rid of it now makes perfect sense.
I hear it's not a bad place to dump off unnecessary thing.
British Telecom is doing a lot with the Internet, has a lot of telecommunications experience and has the infrastructure. The BBC has experience with codec development, real-time delivery of multimedia to large numbers of people, and the problem of digital audio over unreliable networks. Timesys, in the US, has enormous experience with real-time systems and the problems of real-time computer-based applications, although I'm not sure if they have much experience with real-time networking. They might. Cisco, now they have Scientific Atlanta, have not only vast computer networking experience but experience with all kinds of high-performance network systems. Again, since cable television systems must be able to decode the signal fast enough, Cisco must have people skilled in high-performance codec development.
Any of these companies would seem to be better partners than eBay. None of them will likely buy it, but I could see Skype faring better with any of them. They have skills and experience eBay would not have had that relate to what Skype is doing.
This does raise an interesting question, though. If ISPs are highly concerned about the bandwidth requirements to deliver the BBC's iPlayer content (given that that can be delivered best-effort, whereas Skype's cannot) to the point where they think the BBC should pay extra for that bandwidth, and given that ISPs are keen to ditch neutralty and charge providers extra just to get best-effort, it follows Skype will be in for some hefty ISP bills in the future. Is it possible that such extra costs would make Internet telephony on any commercial scale completely impractical?
(To get the customer base to be profitable, Skype would need users worldwide, but they'd be paying every ISP that served at least one customer of theirs plus the backbone providers for both the extra bandwith and the high-end quality of service needed, as well as their own ISP bills. Assuming bandwith charges are equal to QoS charges, that means they pay twice what any other Internet service pays for the same effective level of service. That means they'd need twice as many users as a profitable e-commerce business, assuming service is a major cost. Tha means ramping up to that level would also be very expensive.)
It's a small world and it smells funny; I'd buy another if it wasn't for the money; Take back what I paid (SoM)
Let's hope they don't and Skype dies a quiet death!
We can all use SIP and not pay tribute for a proprietary protocol.. and we can use whatever client we want rather than an annoying proprietary one.
Skype's business model is lock-in.. Die Die Die!
Someone had to say it, this *is* slashdot..
"'Yrch!' said Legolas, falling into his own tongue."
I think you're confused. Skype is internet telephone software, for voice data. It's free, so it's free as in speech.
Do you even lift?
These aren't the 'roids you're looking for.
I used to read PayPalSucks.com alot until I came to realize that a large number of complaints are from people who try to screw the system anyway (ie; people signing up with fake info complaining that their funds are frozen and they can't prove who they are, or opening multiple accounts, or closing an account after receiving a dispute (leaving a negative balance) - and opening a new account, then complaining that they got linked (DUMBASS)). there are probably legitimate complaints on the site and there are many things that Ebay and PayPal do that I don't agree with- but I wouldn't rely on the feedback on that site. I've been using paypal for 5 years and never had a problem.
Al
Well the CEO says:
... our job now is to make sure we continue to build on Skype's successes and grow its passionate community of users.
Q. I read in the Financial Times that we may sell Skype. That if the synergies are strong, we'll keep it in our portfolio. If not, we'll reassess it. Is this true?
We have no plans to sell Skype... and why would we? As I said in the story, it's a great business with a great purpose -- enabling the world's conversations. With a new president, our plan for Skype is to focus on providing the best possible user experience and continuing the incredible growth momentum we've enjoyed with Skype for the past four years.
To be clear, I've fully supported big investments in Skype, including removing the earn-out, and bringing over some top talent like Josh. I think this business has tremendous potential that we've only started to tap. Josh and I are both excited about the prospects
http://ebayinkblog.com/2008/04/18/john-donahoe-talks-to-ebay-ink/
Actually, EBay acquired skype in September of 2005. Their stock fell from 60$ a share to just over 30$ a share between January 2005 and April 2005, long before they picked up Skype. Their stock right now is at 31.71 (as of market close Friday, today), meaning it hasn't ended up far from where it fell to *before* they picked up Skype.
Quis custodiet ipsos custodes?