Valleywag
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Posts Tagged “
Skype
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AT&T plots Skype rival
AT&T and as many as 15 other big phone companies are planning to launch a rival to Skype in 2009. Why don't they just buy it from eBay? That seems easier. [GigaOm]
AT&T and as many as 15 other big phone companies are planning to launch a rival to Skype in 2009. Why don't they just buy it from eBay? That seems easier. [GigaOm]
Everything but auctions boosts eBay's bottom line
Recently anointed eBay CEO John Donahoe thumped his chest over the auction giant's first-quarter earnings. He praised a "diverse portfolio of businesses" as revenues jumped 24 percent to $2.19 billion and earnings rose 22 percent to $459.7 million. The problem: Younger businesses like Skype and PayPal aren't as profitable as eBay's core e-commerce business, which is why profit margins dropped. [WSJ]
Recently anointed eBay CEO John Donahoe thumped his chest over the auction giant's first-quarter earnings. He praised a "diverse portfolio of businesses" as revenues jumped 24 percent to $2.19 billion and earnings rose 22 percent to $459.7 million. The problem: Younger businesses like Skype and PayPal aren't as profitable as eBay's core e-commerce business, which is why profit margins dropped. [WSJ]
ebay
eBay kind of, maybe, finally considering a Skype sale
Asked whether eBay would sell PayPal or Skype, new eBay CEO John Donahoe denied any chance of a PayPal sale but said the company planned to "test the synergies" resulting from the Skype integration. The questioner, Fortune's Adam Lashinsky, later told SAI that Donahoe's answer meant he would give Skype a year "to show synergies with eBay" before selling it. Odds are it'll happen. In October, eBay took a $1.4 billion asset-impairment charge on the company it purchased for $2.5 billion in 2005.
skype
Skype to lay off 30 in European offices
Skype will fire 30 employees in London and Estonia, Om Malik reports. Skype, a subsidiary of eBay, has not yet confirmed the news. The 30 headed for the door will join Skype cofounder Niklas Zennstrom, who in October resigned as Skype CEO as eBay took a $1.4 billion asset-impairment charge on the company it purchased for $2.5 billion in 2005. More »
your privacy is an illusion
German police struggle to tap Skype calls
Joerg Ziercke, president of Germany's Federal Police Office, told reporters that Skype "creates grave difficulties for us" because of its strong encryption. A traditional land-line phone can be tapped very easily, as can a cell phone — but voice-over-IP calls are routed over countless paths across the Internet, making them difficult to intercept. Ziercke said they were not asking eBay to leave "back doors open" to Skype for law-enforcement authorities. Of course, it's likely the National Security Agency has already done that and passes along any significant intercepted calls to U.S. allies. The other theory? That this is merely a headfake to criminals. If the Polizei does have Skype wiretapping abilities, they'll want to encourage evildoers to speak freely. That's it: I'm switching my secret communications back to smoke signals.
rumormonger
Is Google looking to walk off with Skype?
According to London's Web entrepreneurs, Google has been flirting with a bid for Skype, eBay's overpriced VOIP startup. Guardian blogger Jemima Kiss is just the latest to offer eBay CEO Meg Whitman advice in the guise of rumor after a $900 million writedown: Last month Portfolio's Felix Salmon recommended it sell to News Corp. Compared to its other pushes into the telecom business, like the Android cell-phone operating system and a hot pursuit of wireless spectrum, buying Skype may prove downright cheap. Skype has been running ragged ever since August's major outage. Perhaps even Google isn't above some bargain-hunting.
wall street
Analysts stop sniping and give eBay another bid
Skype may be broken in more ways than one, but after taking day or two to reflect, some analysts are back on the eBay bandwagon. JupiterResearch's Patti Freeman Evans told me that "without the Skype writedown, things look pretty good." She said eBay's users are active in the U.S. and abroad. It's all because they've refocused on their core auctions business. How is the rest of the field reacting? More »
Skype is the gift that keeps on taking. Yesterday, the Internet phone service weighed down record revenues from eBay with a massive writeoff. Today's its just annoying customers. The site is reporting technical difficulties with Skype gift certificates that have been issued since Tuesday. [Heartbeat]
eBay reported record revenue but a huge loss — -$936 million on $1.89 billion in revenue — because of a $900 million write-off of its Skype purchase. This is the first quarterly loss for eBay since 1999. Whoops. [AP]
embargo breakers
MySpace friends Skype, adds VOIP to profiles
Looks like tomorrow's rumored MySpace announcement is, as we heard, related to an instant-messaging deal. According to a press release just sent to Valleywag, the big announcement is a partnership between the News Corp.-owned social network and eBay's Skype, which offers both VOIP and IM. What a pairing, between the undervalued MySpace, likely worth billions more than the $580 million News Corp. paid, and the written-down Skype, now worth billions less than eBay thought it was. The bottom line: Now you can call your MySpace friends right from the "add me" page! The full press release after the jump. More »
followup
Hey, why doesn't eBay put Skype up for auction?
Felix Salmon of Portfolio thinks online auction-house eBay should sell Internet telephony service Skype to News Corp. for use in its social network, MySpace. Salmon thinks that a free calling service fits more naturally with MySpace, which is, after all, about communication. While that may be true, eBay will likely have to accept a much lower price than what they originally paid. Even Skype cofounder Niklas Zennstrom is conceding that Skype was overvalued from the beginning. If even a founder is doubtful of Skype's value, though, why should eBay strike a private deal to sell the unit? We say let the marketplace rule. eBay should list Skype on, well, eBay, and auction it off. Just imagine how much profit it will make from the listing fees.
reality check
Jajah adds to eBay's click-to-call nightmare
We'd hardly blame Meg Whitman if, after this week, she decided to hang up on the phone business altogether. On Monday eBay said they were taking a $1.4 billion charge related to their acquisition of VOIP startup Skype. On Tuesday, we noted that one of Whitman's major goals in buying Skype, bolstering its auction business in China, where rivals were using click-to-call features on their auctions to close sales, has turned into a complete failure. And then, yesterday, things somehow managed to get worse. More »
ebay
Skype's failure to make money fast
In an interview just prior to his departure as CEO of Skype, Niklas Zennstrom provided insight into why the internet telephony company was a poor investment for eBay.Some people may want to monetize faster, but the key is to figure out what is the right speed of monetization. If you act too aggressively, there is a real risk you will lose the huge active user base.Implicit in this statement is the recognition that Skype needs to make more money off its users, faster. Quite a trick for a free phone service. But still, not moving too fast? It's been four years and Skype has 220 million users! Would Zennstrom wait until Skype has half a billion users? A billion? More »
geography lesson
China is where Skype really failed eBay
In Kara Swisher's otherwise excellent analysis on AllThingsD of the Skype writeoff's effect on Facebook, there's a string of nonsense that desperately bears correction. Swisher ramblingly suggests that eBay bought Skype for some kind of ability to target ads and premium offerings to the VOIP service's users. Nonsense. It's well-documented that eBay CEO Meg Whitman got the idea on a trip to China, where she saw that users of rival auction sites were using VOIP calls and instant messaging to close sales — a useful feature in a country still getting used to conducting business electronically, rather than face to face. Adding Skype to eBay's auctions in China, she hoped, would boost its market share. No such luck. More »
deals
Skype's loss could be Facebook's, too
When it rains, it pours. And eBay's recent billion-dollar writeoff of Skype, the VOIP startup it bought two years ago, could have an impact on Facebook's negotiations to sell a stake in the social network, at a high valuation, to Microsoft or another large backer. (Both Bernhard Warner and Kara Swisher make this observation, which I'll attribute to great minds thinking alike.) Skype's financial failure is a sobering reminder of the risks of overpaying for a startup. And all of a sudden, Microsoft CEO Steve Ballmer is playing diffident, saying Facebook "might be a fad." But what may be forgotten in this latest skeptical turn to the hype cycle is that underpaying has risks, too. More »
exits
Skype rains on eBay's parade
Niklas Zennstrom, CEO of Skype, and eBay are paying the price for the disastrous acquisition of the Internet telephony service two years ago. The Skype cofounder has stepped down from his CEO role, and eBay will take a $1.4 billion asset-impairment charge — more than half of the $2.5 billion they paid for the company. The silver lining? eBay only has to pay $530 million of a potential $1.7 billion earn-out to Skype investors, since Skype is performing so poorly. With the shareholder payment out of the way, eBay can more easily put Skype on the auction block. And Zennstrom can focus on Joost, his new online-video venture.
followup
