eBay unhappy with Skype acquisition

By abhishek at 1 October, 2007, 2:30 pm

“Crazy Valuation,” exclaimed the web community when ebay bought out Skype a couple of years ago for a sum which has left it gasping for breath today. $2.6 billion� was a lot of money then and is a lot of money now! All companies were in a buying binge and ebay seemed to have gotten away with the deal back then with not so much scrutiny from experts from the industry and other “experts” from the blogosphere because everyone including companies like eBay was guessing and learning to value start ups such as these. But, eBay has learnt that the deal has proved costly for them, both literally and metaphorically.�

Niklas Zennstorm has stepped down as the CEO of Skype to concentrate his efforts on sojme of his personal projects or whatever.He will remain on the company’s non-executive board. The Chief Strategy Officer of eBay, Michael van Swaaij will try to get the house in order.��

Since Skype was overvalued, it warrented ‘correct valuation’ for a long time now and the day finally came when ebay took a $900 million so-called impairment write-down against the value of Skype. in other words, eBay is saying that, ‘We !@#$ed up. Now, let’s put on a condom!’ eBay is now reassessing Skype’s value relative to its overall business today. The problem always has been that Skype could not find a way to monetise their clients or may be their mantra has always been, ‘Thy shall not charge the customer.’ Although it earns a few dollars through voice mails and calls on landlines/mobile phones, it is far from enough to explain the valuation that it received in 2005. ebay wanted to integrate ebay’s paypal system to this Voice Over Internet Protocol (VOIP) service to connect the millions of buyers and sellers at the market place. We are still waiting for that to materialise successfully. �

Btw, Although eBay committed a $2.6bn faux pax, you can download skype here . It’s free!�

Have been often my blog, Why don't you subscribe to our RSS feed.

If you enjoyed this post, make sure you subscribe to my RSS feed! Hope to see you again

Categories : Technology