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Businesses Communications The Almighty Buck IT

Ebay Rumored to be Buying Skype 199

Posted by CmdrTaco from the now-thats-a-really-strange-marriage dept.
JDStone writes "Rumor has it that trusted sources from The Wall Street Journal say Ebay is interested in buying Skype. Later after the announcment, Ebay Inc. shares fell 4.3 percent."
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Ebay Rumored to be Buying Skype More

Ebay Rumored to be Buying Skype

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  • sKYPE (Score:4, Funny)

    by Widowwolf ( 779548 ) on Thursday September 08, 2005 @01:56PM (#13511850) Homepage
    So will i be able to call and complain about the massive ebay fees with my skype account?

    • I guess eBay wants to enable its users to communicate with each other during bids. Much like real life bidding...this would be fun!

      Maybe they want users to talk to the seller over voIP to save money....paypal+skype+ebay=powerful bidding.

      • Re:sKYPE (Score:3, Funny)

        by Widowwolf ( 779548 )
        but they will charge you exhorbitant fees for it~ then when you try to pay those fees , paypall will freeze your account and you wont be able to call either ebay or paypal to complain becuase they will have shut your phone off!

    • Re:sKYPE (Score:2, Funny)

      by PlasticMetal ( 913402 )
      Yes of course, just follow the instructions on 0-700-SKYBAY and maybe on lower than 10th level of DTMF service menu you will have luck to scream on innocent living person of flesh and blood.

  • Horrible spelling (Score:5, Funny)

    by bigtallmofo ( 695287 ) on Thursday September 08, 2005 @01:56PM (#13511859)
    The spelling of Slashdot editors sure has gotten bad lately.

    Back to the topic, why would EBay want to buy a peanut butter manufacturer? And if they did want to, I would think Jif would be a more appropriate takeover target.

    (...wondering how many mods have their humor hat on)

    • Re:Horrible spelling (Score:5, Funny)

      by Neil Blender ( 555885 ) <neilblender@gmail.com> on Thursday September 08, 2005 @02:31PM (#13512186)
      I thought they misspelled Google.

    • Re:Horrible spelling (Score:3, Interesting)

      by tpgp ( 48001 )
      why would EBay want to buy a peanut butter manufacturer? And if they did want to, I would think Jif would be a more appropriate takeover target.

      Market analysts say [marketwatch.com] (and market analysts are never wrong) that skype "could help eBay quickly improve customer service"

      Anyone who's used Paypal know how important "customer service" is to ebay :-)

      In all seriousness - as WSJ intimates, automated buyer to seller / buyer to previous buyer / etc VOIP calls, could improve ebay's model of doing business.
      • I'm not sure if you:

        1) Are +5 thread hopping

        2) Didn't read the piece you quoted

        3) Are making either a joke or a serious point about peanut butter that has gone over my head

      • Re:Horrible spelling (Score:4, Insightful)

        by robertjw ( 728654 ) on Thursday September 08, 2005 @03:30PM (#13512699) Homepage
        In all seriousness - as WSJ intimates, automated buyer to seller / buyer to previous buyer / etc VOIP calls, could improve ebay's model of doing business.

        Explain to me exactly how VOIP calls are going to help "auction success rate" and consequentially ebay's business model? As a regular ebay purchaser and occasional ebay seller I will NOT download and install skype so that the freaky people that buy and sell stuff on ebay can talk to me via voice. I much prefer the relative anonymity of email, where I can delete abusive messages, to actual voice conversations.

        With ebay's HUGE userbase, there are a large number of people out there that can't even read. If you have ever attempted to sell anything on ebay, I'm sure you've been bombarded with questions that were clearly answered in your description. Adding voice capability is just going to make dealing with these bidder more annoying. With many ebay sellers selling multiple items at a simultaneously, who is going to have time to discuss problems over VOIP?

        ebay has the online auction business well dominated, why would they want to branch into something completely unrelated?
        • I mostly agree with your points, but:

          1) If you don't like eBAYskype(tm) don't use it.

          2) People who do like eBAYskype(tm) can use it.

          3) More communication options are better then less.

          *shrug* I hardly ever use ebay, but I use skype all the time. I see skype as being more useful - and I certainly see the use in being able to talk to someone I am buying from.

          • Re:Horrible spelling (Score:3, Insightful)

            by robertjw ( 728654 )
            1) If you don't like eBAYskype(tm) don't use it.

            2) People who do like eBAYskype(tm) can use it.

            Problem is, ebay is going to potentially spend BILLIONS of dollars to acquire skype. They must have a better plan than 'use it if you like it'. Adoption rate would have to be rather signficant for this deal to be worthwhile for ebay - and I can't see that happening.

            I see skype as being more useful - and I certainly see the use in being able to talk to someone I am buying from.

            From a buyer's perspecti
    • Haven't you kept up? The patent on Jif expired a while back. No reason for them to put any money into that. Though there's been another rumor of Peanut Goodness, aka PNG, that tried to compete with Jif but didn't really succeed.

  • To steal a joke from Fark (Score:5, Funny)

    by Anonymous Coward on Thursday September 08, 2005 @01:56PM (#13511862)
    Talks fail when at the last second some jerk bids $3,000,000,000.50
  • will we soon be attending live auctions via skype?

    sure, sometimes I would like to look at the sellers face when he says, I didn't test the notebook, but I think it is running fine, but I won't guarantee...

    W00t
    • I hope not. There's a lot of items on eBay I'd hate to hear spoken aloud in front of others but fortunately barkers don't usually speak too clearly anyhow and there's another problem. "But... I though I was bidding on a steel doe sculpture, not a dil- (click) Hello?! Hello?!"

  • You know it! (Score:3, Funny)

    by Anonymous Coward on Thursday September 08, 2005 @01:57PM (#13511866)
    Ebay is going to be outbid at the last possible moment. OUCH!

  • Wall Street Journal (Score:5, Insightful)

    by geomon ( 78680 ) on Thursday September 08, 2005 @01:57PM (#13511867) Homepage Journal
    While they have a strong track record for supporting business and tracking developments in the business world, I take nearly everything they offer as rumor or opinion with a grain of salt. Remember that it was the WSJ that was an early flogger of Cold Fusion. They were speculating about the enormous potential of a science "discovery" that hadn't even been vetted by the larger scientific community. I wonder why they don't have a cold fusion section in their paper an more.

    This marriage between Ebay and Skype does have some marginal plausibility due to the need for Ebay to spend some of its reserves capturing markets outside of the online auction business. Skype needs cash to fend off Microsoft's entry into VOIP. The rumor has some potential traction, but the market has given its opinion to the deal. A drop of nearly 5% in your stock price is something a CEO and board of directors can't easily ignore.

    • qouting from Om Mallik's blog [gigaom.com]-

      "I am not sure what to make of the conversations, because frankly at $2-to-$3 billion, it doesn't make sense for eBay to get into a whole new business. I can understand giving the consumers ability to click-and-call the seller/buyer.
      But it can be done fairly cheaply and easily. When connecting to PSTN, eBay will then have to deal with all that comes with it, including a nosy and notoriously pesky FCC. Are they ready for it? Why not partner with someone - and there are enou
    • Skype needs cash to fend off Microsoft's entry into VOIP.

      I would have said Google.

  • What does EBay want with VOIP (Score:4, Interesting)

    by Suburbanpride ( 755823 ) on Thursday September 08, 2005 @01:57PM (#13511877)
    from the article:
    "Whenever a company may do something that's completely different than its historical focus, there is risk,'"
    My qyestion is, what would ebay want with VIOP? Paypal and Half.com made sense for ebay to pick up, but I'm just not seeing this at all...

    • Re:What does EBay want with VOIP (Score:5, Insightful)

      by SlayerofGods ( 682938 ) on Thursday September 08, 2005 @02:08PM (#13511988)
      They're buying it because they think it will make them money.
      Simple as that.
      Just because they started out providing one type of service doesn't mean they can't offer something new.
      • They're buying it because they think it will make them money.
        Simple as that.
        Just because they started out providing one type of service doesn't mean they can't offer something new.

        Investors want to see the value add. If there's no benefit to the merged company, then they won't be interested in the deal. You have to keep the investors in mind when talking about a public company.
        And when a company is deciding who will buy them, they tend to look for the same. True, they look at the offer price, but
      • How are they going to make money with it? I though all Ebay/paypal were good for was supporting criminals and tax dodgers. (I stopped buying anything on EBay when it became apparent that more than 50% of the advertised products were scams, stole, or pirated, and I don't know anyone who declares money received through paypal to the tax man)
      • Sure. It's just that normally stockholders like their companies to only do business in areas the companies are good at. As in "I'm perfectly capable of investing into voip myself, if I thought that was smart".

        A move like this should have some justification other than "we think VOIP is good business", otherwise the stockholders would rather have the cash used to buy Skype as dividend to invest it themselves (to VOIP if that's what they think is wise)...

        In other words: if Ebay has nothing to offer Skype

    • Re:What does EBay want with VOIP (Score:5, Insightful)

      by MoralHazard ( 447833 ) on Thursday September 08, 2005 @02:16PM (#13512070)
      You ask a good question--usually, companies don't bother buying other companies unless they see the potential to leverage some synergy between the parent and child.

      It may be something hard to see from the outside, but I had a few ideas:

      1) Ebay has a ton of core compentency in connecting and managing a VERY large number of users, especially in near-realtime transactions. Their auction business is dependent on their technical abilities to have an easy-to-use front end for a huge user population, as well as a reliable back-end that can manage how those users want to interact with each other.

      2) Ebay has a large userbase. Skype's ultimate success depends on reaching a large enough mass of users to amortize its fixed costs, and so that network effects will make its service more attractive to new users. There's a cross-selling opportunity, here, along the lines of Google offering IM on top of its email services.

      3) Fraud prevention. Ebay doesn't do a perfect job of preventing fraud (phony accounts, stolen accounts, etc), but it had a lot of experience dealing with it. I would imagine that a telecom service like Skype has similar issues with people abusing accounts, or that they foresee such abuse as the service grows more popular. All of the skills and expertise needed to deal with fraud in a massive userbase (like behavior pattern analysis, customer interaction, etc.) may be cross-applicable to both industries.

      But these are just guesses. I imagine that there are possibilities that Ebay and Skype see, but that are hidden from outsiders. Might as well wait and watch what happens.
      • Um .... I think it's worth pointing out that eBay doesn't have a "core competency" in maintaining " VERY large number of users, especially in near-realtime transactions." Actually, they kinda sucked at it. Their original architecture didn't scale well. Which was part of why they hired an outside contractor [ibm.com] to rebuild their system.

        If anyone ought to get credit for that being their 'core competency,' it's IBM and Sun, who actually did the work.
    • > My qyestion is, what would ebay want with VIOP? > Paypal and Half.com made sense for ebay to pick > up, but I'm just not seeing this at all... Perhaps you should see about a spellchecker first?

  • Here come the ads. (Score:3, Insightful)

    by L. VeGas ( 580015 ) on Thursday September 08, 2005 @01:57PM (#13511879) Homepage Journal
    If this happens, I'll put money on it that the free pc to pc calls will become adware.
    • "Yes mom, I'll be over next week t--"
      "DO YOU NEED A LARGER P3N1S?! JUST CALL 244-2625 NOW!! BIGGER P3N!S FROM OUR PH4RMACY DIRECT TO YOU!!!1111"

      I just wonder how they'll be able to speak the typos to get past the spam filters...
  • I mean other recent acquistions such as Shopping.com [shopping.com] have made sense. Ebay is not a teleco. It doesn't fit with any other business lines. Ebay is about getting the best price on goods as Shopping.com [shopping.com], Half [half.com] have proved. Why Skype?
    • Maybe they're going after that last group of buyers that are still afraid to give out their credit card number out on the internet. Calling someone to give a number seems safer to some, even if the call technically is over the internet. But at least its free. Nobody is going to call long distance to give out a CC number.

    • Re:Why? (Score:1, Redundant)

      by loconet ( 415875 )
      VoIP auctions?

    • Re:Why? (Score:5, Interesting)

      by nametaken ( 610866 ) on Thursday September 08, 2005 @04:00PM (#13512989)

      Its not uncommon for a company with cash in the bank to buy up unrelated companies to diversify its holdings. Its much like an individual buying a mutual fund, you don't put all your eggs in one basket. Companies like Microsoft do this all the time. They've bought all kinds of seemingly unrelated companies.

      Additionally, it could provide a near-turnkey solution for better buyer/seller communication, which could be cool.

      From a number of persepectives, it could happen. It just doesn't look like the market approves right now.
  • When compared to taking all those support calls via AT&T.

  • Voice phishing (Score:5, Funny)

    by confusion ( 14388 ) on Thursday September 08, 2005 @01:59PM (#13511908) Homepage
    Does this mean that I'll be getting people calling me for my ebay account info on my skype line now?

    Jerry
    http://www.cyvin.org/ [cyvin.org]

  • paypal (Score:5, Funny)

    by papasui ( 567265 ) on Thursday September 08, 2005 @02:02PM (#13511934) Homepage
    They should buy skype and give it to Paypal so that you can actually get a hold of those fuckers.

  • Wait a minute.... (Score:5, Funny)

    by lucabrasi999 ( 585141 ) on Thursday September 08, 2005 @02:02PM (#13511939) Journal
    Rumor has it that trusted sources from The Wall Street Journal say Ebay is interested in buying Skype.

    Rumor has it that trusted sources from Joe's coffee shop say that Sam might possibly be interested in thinking about considering reviewing the possibility of actually looking into purchasing a piece of pie.

    • Piece 'o pie, bud?

    • Rumor has it that trusted sources from Joe's coffee shop say that Sam might possibly be interested in thinking about considering reviewing the possibility of actually looking into purchasing a piece of pie.

      Rumour has it that Melinda actually moved the pie from table 19 to table 20 deliberately to confuse Sam but Joe didn't know and now is having a flamewar with Sam about a possible refund...

      ...but don't tell anyone else!

  • worst. summary. ever. (Score:4, Informative)

    by Anonymous Coward on Thursday September 08, 2005 @02:04PM (#13511946)
    Rumor has it that trusted sources from The Wall Street Journal say

    Um, why the hell the contorted syntax? Why not just say:

    The Wall Street Journal is reporting EBay is in talks to acquire Internet-telephony company Skype for $2 billion to $3 billion, in a deal that would represent a dramatic shift in strategy for the online auction giant. Bloomberg has the details [bloomberg.com] for those without a WSJ account.

    Geez, Taco. Grow up and act like a real editor.

  • In other news... (Score:5, Funny)

    by brakk ( 93385 ) on Thursday September 08, 2005 @02:08PM (#13511985) Homepage
    Rumor has it that trusted sources from My Pants say Wang Enterprises is interested in buying Skype. Later after the announcement, My Pants fell 4.3 percent.

    Come on. It's like everyone is rumored to buy Skype these days.

  • Google + Skype = (Score:5, Funny)

    by 3770 ( 560838 ) on Thursday September 08, 2005 @02:11PM (#13512024) Homepage

    Google + Skype = soiled telco executive underwear

    Ebay + Skype = telco executive goes "meh"
    • There is a HUGE difference between Ebay and Google. It's like comparing a retard who got lucky with a lottery ticket to Einstein. EBay's motto might as well be "Do Maximum Evil". They treat their users like a bunch of enemies. The one-trick pony known as Ebay can't even manage their own company (including Payapl) right. What makes you think they can do anything positive with this buyout?

      Google, on the other hand, is always innovating with features that make you go "ahhhhhhhh" I needed that! It's refre

  • Rumors only help Google and Apple - not eBay (Score:5, Funny)

    by Se7enLC ( 714730 ) on Thursday September 08, 2005 @02:13PM (#13512038) Homepage Journal
    "Rumor has it ... Ebay Inc. shares fell 4.3 percent."

    When will they ever learn....only Apple and Google stocks rise when rumors get out!
  • Bid for the best [online/real life/rental] [girl/boy]friend?

  • eBay's market rating (Score:5, Funny)

    by Seehund ( 86897 ) on Thursday September 08, 2005 @02:23PM (#13512128) Homepage Journal
    "Ebay Inc. shares fell 4.3 percent."

    You mean they're down to only "AAAAA++++++!!!111" now?
  • just like the real thing. that's the only thing that Skype coul bring that remotely makes sense.

  • Skype wont sell (Score:3, Interesting)

    by dep01 ( 730107 ) on Thursday September 08, 2005 @02:30PM (#13512180) Homepage
    Skype already turned down a billion dollar deal from another company. They're holding on to it.. I'm sure they wont sell to eBay.
  • that caused AOL to buy winamp

  • Does that mean... (Score:3, Insightful)

    by canfirman ( 697952 ) <pdavi25 @ y a h o o . ca> on Thursday September 08, 2005 @02:41PM (#13512274)
    ...I need a Paypal account to SkypeOut? I can see in the future that Skype will no longer be free but a "subscription service", brought to you by EBay.

  • Will help save their reputation (Score:5, Funny)

    by m50d ( 797211 ) on Thursday September 08, 2005 @02:43PM (#13512293) Homepage Journal
    Some people don't trust Skype because of its association with Kazaa founders. Thankfully I'm sure their minds will be laid to rest with it being run by ebay, after all everyone knows their subsidiaries are always very reputable companies, we all know we can trust paypal with all our money.

    Oh, wait.

  • Since it looks like many people are interested in Skype, giving room for an auction-type atmosphere, will they eventually opt for the 'buy it now option'? And what is the reserve price set at? Will they fall victim to all the annoying 'features' currently found on ebay?

  • Laughable (Score:3, Insightful)

    by Jesus IS the Devil ( 317662 ) on Thursday September 08, 2005 @02:54PM (#13512399)
    Ebay/Paypal is the model of what internet business should NOT be about. Their tech support is as aweful as it can get. They innovate very little, and hardly improve on their tools to make life for users easier.

    No wonder their stocks are taking a hit. They don't even know how to run their own company right, how can anyone expect them to do the same with a totally different company?

    • They innovate very little, and hardly improve on their tools to make life for users easier.

      Paypal, and to a lesser extent, eBay both have some problems with tech support, but I still take issue with the above statement. eBay was a very innovative idea which is why it became so successful. Paypal was a great idea, but it did have some competitors when it was coming up, so there must have been something about its interface that users preferred.

      As for continuing innovation, to prevent fraud, eBay has had to c

  • In the News Today... (Score:5, Funny)

    by JabberWokky ( 19442 ) <slashdot.com@timewarp.org> on Thursday September 08, 2005 @02:59PM (#13512450) Homepage Journal
    Google announced that a janitor kicked around the idea of buying Taco Bell. Google stock rose $47 and Yum! Brands, owner of Taco Bell, had their stock go up $132.

    Meanwhile eBay announced that they had struck a deal to buy Microsoft, WalMart and a US Mint. "We can now literally print our own money, plus we will have a near monopoly in both software and tangible retail goods", said eBay President Meg Whitman. Leery of the announcement, eBay's stock price dropped to only four cents per share. "I ain't gonna trust no dot com blip blip stock", said noted day trader Erwin Lapsey. "I lost my shirt on them, and they are all evil".

    Microsoft President Steve Ballmer had only three words to say about the deal: "Developers! Developers! Developers!". The sweat running down his broad manly chest then shorted out the microphones, abruptly ending the press conferences. Meanwhile, deep inside Mum-Ra's lair, the lich formerly known as Sam Walton and current President-in-Secret wheezed his single word comment about the proposed merger: "...braaains...".

    --
    Evan

  • Sweet! (Score:2)

    by rlp ( 11898 )
    Now I can pay for all my VOIP calls with PayPal. Oh, wait ...
  • 1) Buy company that offers an intersting service with reasonable fees.

    2) Jack up fees until customers bail.

    3) ??????

    4) Profit!
  • Just for reference, Unlike every other large internet company, I am not interested in buying Skype.

  • Please, no American buyers! (Score:4, Interesting)

    by Anonymous Coward on Thursday September 08, 2005 @03:57PM (#13512961)
    One of the nice things about Skype is the strong encryption. The American government is considering legislation to require backdoors in internet telephony. I've lost the link but I saw an interview with the CEO of Skype, asking how they would respond...the CEO simply said that as a company in Luxembourg, he was perfectly free to ignore American legislation, and intended to do so. EBay wouldn't have the same freedom.

  • I'm worried (Score:3, Interesting)

    by kartan ( 906030 ) on Thursday September 08, 2005 @04:13PM (#13513090)
    Anyone else worried that Skype, if owned by Ebay, would be more likely to bend to the FCC's demands to allow federal wiretapping?

    Typically big American corporations like Ebay play ball with the government, and one of Skype's most attractive features (IMO) is that they don't allow wiretapping (the data is encrypted end-to-end).
  • I think the idea is to use the combination of PayPal and Skype to create a vast network on internet "payphones" where you deposit money via PayPal to talk internationally for ten minutes.

    Humor or insight? You decide!

  • This Rumor Actually Makes Sense!! (Score:3, Interesting)

    by donnacha ( 161610 ) on Thursday September 08, 2005 @10:49PM (#13515727) Homepage
    Okay, despite my inner-skeptic's enjoyment of recent Skype rumors, I have to admit that his one is not as ridiculous as it first appears.

    I am posting fairly late in this discussion but, as no-one else has made the following connection, I will put it forward.

    The key here is not Ebay but PayPal and their recent repositioning.

    Before I go any further, I should mention that I don't believe anyone is going to be paying 10 figures for Skype, that's just ridiculous. From what I've heard, their P2P network is completely unsustainable, with far too few supernodes. If anyone does buy Skype, they will probably do so for the brand and customer base but replace the existing network with a more centralised one.

    Skype's brand isn't really such a great catch - it would be quickly superseded if someone offered even a marginally better service - all ownership of the Skype brand would provide is a small head start. Is that worth billions? I don't know but I suspect not.

    As for Skype's existing customer base, they say they have 52 million users, which really means 52 million downloads. Of those, only 2 million have ever actually parted with cash to use the Skype-Out feature that allows you to make calls to regular phones.

    Now, bear in mind that I am one of those two million - I forget what I paid, probably a $5 minimum charge, just to play with the service for a while, probably used up a dollar or so calling embassies in China for a laugh. In the space of one week I downloaded Skype twice, installing it on 2 different machines to see if I could call myself. I made a grand total of ONE free call to another Skype user, a guy in Canada who posted on the Skype forum, asking for someone to call him so that he could see if Skype worked. I then annoyed a lot of people in China and, having had my fun, abandoned whatever money I had left in my account and uninstalled Skype from both machines.

    If I am at all typical of first wave adopters, their active userbase is far, far smaller but they won't publicly release that figure. Ebay, however, will be well aware of it and will negotiate accordingly.

    As for paying customers, well, I'm not the only person who's willing to blow a few dollars to play with a shiny new toy but quickly bored by it. How many recurring customers do they have? And how much do you think they spend on average? And how big is Skype's margin on that?

    Let's say they have 1 million active paying customers (nonsense, but what the Hell), each of those would have to be valued $100 to make Skype worth a billion. That is about twice the going value of a mobile phone customer. Ridiculous.

    So, having established that Skype is worth far less than over-excited journalists would have us believe, let's presume that Skype is actually willing to sell for far, far less. Who, then, would be interested in buying?

    Any of the big names could probably harness the initial hype of the sale to their benefit. Yahoo could certainly use the edge against Google and they've swallowed some pretty interesting companies lately in their quest to reinvent themselves. Google knows that and would probably like to take Skype out of Yahoo's reach, but, generally, they prefer to develop their own tech in-house.

    Vodaphone could do something really smart with Skype, link their networks in a way that would really blow the other mobile providers out of the water but, from what I know of corporate decision-making, that might be a little too out-of-the-box for a non-Internet company.

    Which brings us back to PayPal. Last week, they announced something fairly momentous that was missed by pretty much everyone. After years of holding back the whole idea of micro-payments, they finally decided to granularize their fee scale to make smaller transactions viable. Before, you had to pay 30c + 3% of every transaction, leaving you with 67c from a dollar sale. Now, they are willing to take 5c + 5% instead, leaving you with 90c. This is huge news because it makes viable

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