Posted April 18, 2008 5:24 pm by with 12 comments

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Just a couple weeks ago, there were rumors running around that Google was looking to buy Skype off eBay—er, from eBay. While that rumor hasn’t materialized (yet), eBay has now admitted that they may sell off Skype later this year.

The Financial Times is reporting that eBay CEO John Donahoe would be willing to part with the P2P/VoIP company if they couldn’t find a way to integrate it with their core eCommerce business. Donahoe replaced Meg Whitman as CEO two and a half weeks ago.

Perhaps this is something they should have thought of before buying the company for a reported $3.1B in 2005. eBay wrote off Skype with an impairment charge on the company in Q3 2007.

Personally, I’ve never seen the connection between telephone calls/IMing and online auctions, unless you needed to call a seller for some reason. FT reports that this was the initial intent of the acquisition:

Ebay originally believed that Skype would oil the wheels of its online markets by making communications easier between buyers and sellers, while also supporting new business models such as “click to call”. Nearly three years after the acquisition, however, Ebay has yet to prove Skype can help its other businesses.

Meanwhile, many opine that Google buying Skype would integrate well with Google’s other phone offerings, VoIP via GTalk, GOOG-411 and GrandCentral.

On the other hand, Donahoe says that things are going well internally for Skype:

While the acquisition of Skype has widely come to be seen as a blunder for Ebay, the phone service itself has continued to grow fast, adding another 33m registered users in the first three months of this year to reach 309m. Although most use it for free internet phone calls, the addition of extra paid services helped Skype to increase its revenues to $126m in the first three months of this year, up 61 per cent from the year before.

“What we know is, Skype is a great stand-alone business,” Ebay’s CEO said. Its revenues this year are set to top $500m and the service will be profitable, he added.

Also in the FT story, Donahoe addresses speculation over eBay spinning off PayPal as well, citing the advantages of the company for eBay and saying that they’d be together “for many years.”

  • I think Ebay can actually figure out a way to use Skype. I mean for 3.1B ya kinda have to. Maybe if they started beta testing the use of it with their online auctions it might just catch on.

    Paul Baranda’s last blog post..2 Simple Must Haves For Every Makeup Bag

  • We agree with Paul but then again, if Google wants it – they will probably do anything to get it (per usual).

  • I think Skype users will get many extra features when Skype already handled by Google. Cant wait to see what new features will be..

  • No matter who owns skype, it can only grow further as its customer base is very loyal and fiercely protective.

    Nicole’s last blog post..eBooks – Another Way to go Green!

  • Dan

    Android + GoogleSkype + Google’s Open access to 700Mhz spectrum = mainstream, wireless VoIP.

  • PS3

    I’m not sure quite where Skype fits in to the online auction equation – I for one don’t want to talk to my buyers in that way.

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  • It wouldn’t be the first time Google buys a similar platform to a service they already kind of have. This sounds like Google Video / YouTube all over again.

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  • They trying to save their money.

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  • Mobile is where the future lies, and Google will definitely be acquiring a substantial asset to further their mobile aspirations if they purchase Skype. Telecoms operators should start getting nervous indeed!

  • go for it, anything that can cut the cost of phone calls is spot on in my books

  • It will be interesting to see whether eBay sell Skype or not.