EBay Mulling Skype Sale 82
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."
Not sure why skype was bought in the first place (Score:5, Informative)
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.)
Re:The window is closing fast. (Score:5, Informative)
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..
The Financial Times Says that the CEO says... (Score:5, Informative)
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/ [ebayinkblog.com]
Re:total failure (Score:4, Informative)
SIP, not Skype (Score:3, Informative)
Re:Call me when they're going to sell PayPal (Score:1, Informative)
Re:Call me when they're going to sell PayPal (Score:3, Informative)
EBay was actively fighting PayPal from being used on listings until they realized that it would just be easier to buy PayPal than to fight them and have their own payment service. Perhaps you remember Billpoint (eBay Payments)? EBay also promoted an Escrow service and a Western Union auction payment service as well.
Once EBay acquired PayPal, they were very aggressive about promoting Paypal and killed off Billpoint. They also pretty much shutdown access to their other payment partners and killed them off.
Now EBay not only has PayPal as the major option for payment, they force you to use either a premier or business account for EBay. You can no longer use a personal (free) account on EBay and you can't reject credit card payments. This works out better for buyers probably but it means more fees for sellers. With no more Paypal personal (free) accounts used on EBay, Paypal became a lot more profitable.
BTW, I'm probably crazy in the fact that I use PayPal as a "savings account" since they have high-interest on their money market and it's very liquid / easily accessible. As a bit of protection though, I got the Verisign security key for PayPal which generates a 6-digit number every 30 seconds that is unique for logging in.