eBay To Buy Skype For $2.6 Billion 298
rfunches writes "It's not a rumour anymore. BBC News online reports that eBay will pay 'half the amount in cash and the other half in stocks to create an unparalleled e-commerce and communications engine'." The $2.6 billion purchase would give eBay access to the VoIP market, of which Skype claims it has 2 million users online at any given time. BBC speculates that eBay will use Skype to allow sellers and bidders to communicate via voice; I have also heard that live auctions a la Sothebys might also be a possibility. Also reported at Wall Street Journal (registration), New York Times."
Paypal (Score:5, Funny)
Re:Paypal (Score:5, Interesting)
LOL!
It's good to see that hot air still sells, dang this is almost like the heady days 97-98!!
2.6 Billion dollars for what? A client list? A gateway to copper lines?
Sheesh!
Re:Paypal (Score:2, Insightful)
Re:Paypal (Score:3, Interesting)
Re:Paypal (Score:2)
Re:Paypal (Score:5, Insightful)
But why buy into it at all? Skype isn't a natural extension of eBay's business strategy; it's not even related to what they do. It's sorta like Pizza Hut coming out and announcing they're going to buy Lockheed Martin and build fighter jets. The general tone of the NY Times article is bafflement. Generally speaking, businesses do best when they stick to their core business- when they stick to one thing that they know how to do.
Re:Paypal (Score:4, Funny)
Will SKype executables remain multi-plaform? (Score:3, Interesting)
Also, remember that Skype is not an open protocol. You cannot write your own client should support for your platform be discontinued.
Re:Will SKype executables remain multi-plaform? (Score:3, Insightful)
At the moment Skype is a good product with a geek (& Joe Noob) friendly image so there's no incentive to want to create an alternative client. Should Skype drop a platform though, i'm sure atleast some of this enthusiasm for the service would be sucked into open
Re:Will SKype executables remain multi-plaform? (Score:3, Informative)
OTOH there's no need for an open skype when SIP is the standard VOIP protocol that works anywhere.
Re:Will SKype executables remain multi-plaform? (Score:3, Interesting)
For some reason, Skype on Windows cuts out a lot. On Linux, it's as clear and smooth as if I'm in the same room as the person I'm conversing with.
Too bad it's proprietary/closed source. At least it's free as in gratis.
comments (Score:5, Funny)
Skype is a dead-end. (Score:5, Insightful)
Furthermore, eBay has a history of poor human rights concerns [internalmemos.com] and owns PayPal, probably the worst on-line payment site ever created [paypalsucks.com].
I predict more consumer-hostile behavior from eBay and will continue to boycott all of its products.
Re:Skype is a dead-end. (Score:5, Insightful)
As opposed to what? How can you justify this opinion? Worst on-line payment site created, but most used. I can't think of any alternatives, please list some?
Re:Skype is a dead-end. (Score:5, Informative)
Re:Skype is a dead-end. (Score:2, Funny)
Alternatives to PayPal (Score:5, Informative)
Re:Alternatives to PayPal (Score:3, Insightful)
> WorldPay, FirePay, NETeller, ProtX, BidPay, NoChex, Verisign, SecPay,
> FastPay, NetBanx, ChronoPay, PPPay, MoneyBookers, ACT eCash, 900Pay,
> Citadel, etc. etc.
But which ones:
* Work internationally without major headaches.
(e.g., a transfer of funds between, say, Australia and Canada when both the sender and the receiver work in their native funds)?
* Allow flexibility in sending and receiving the funds
(by credit card, debit card, direct link to bank account, etc.)?
* Have low fees and reasonable con
Paypal (Score:4, Interesting)
Re:Skype is a dead-end. (Score:5, Insightful)
Skype is not built on open standards like SIP and remains isolated to its own so-called "Peer to Peer" network. It is to the Gizmo Project as AIM is to Jabber.
Just because it's proprietary doesn't make it a dead-end. You may as well say that every 'open' project will be huge.
Re:Skype is a dead-end. (Score:3, Informative)
BTW, Gizmo uses open standards, but is not open itself (see ahref=http://www.gizmoproject.com/gizmo-end-user.
SIP will (probably) be incorporated into the next gnomeMeeting release.
Re:Skype is a dead-end. (Score:3, Interesting)
this [gizmoproject.com].
_please_ mod parent down ..... (Score:2)
In any case, I don't see what it has to do with 'human rights concerns'.
Other posters have sufficiently rebutted your claim that PayPal is the 'worst on-line payment site ever created', and your Gizmo plug, so I'll resist from arguing those p
Re:Skype is a dead-end. (Score:4, Insightful)
I don't understand your logic. Why is it the automatic death of something to not be based on an open standard? An open standard is nice in some obvious ways, but I'd take something closed that works well over anything else, open or no.
Isn't the POTS system closed? Pretty successful, though, no? And AIM, for that matter, is still doing pretty well. Windows? Closed, sucks, AND very successful.
I think your reports of Skype's imminent demise are premature, given that it's already well recieved and actually quite well designed. I think you may be getting a bit religious-minded about open standards. I probably agree with you that it would be The Right Thing if everything were, but I think you've let the dogma get to you if you think something's going to die just because it isn't based on an open standard. Would that it were the case, though...
Re:Skype is a dead-end. (Score:5, Informative)
No, it is an open standard, regulated by the FCC, 47 CFR 68.3.
See the FAQ [fcc.gov]
Re:Skype is a dead-end. (Score:2)
Re:Skype is a dead-end. (Score:2)
Nope, International standard.
AIM
Anyone still use it? Its been replaced by jabber and Windows Messenger, and I think messenger will die from neglect eventually.
Windows
Maybe closed, but has clearly documented APIs like DirectX and evens publishes developer kits.
If you want to see what openness gets you, look at TCP/IP, SMTP, HTTP and HTML. These are bigger than any closed standard and often started as a lesser competitor to proprietry protocols (DecNet, SNA, X400, Gopher, PDF, D
Re: (Score:3, Funny)
Grrrrreat (Score:5, Funny)
over $1000/user (Score:5, Interesting)
Re:over $1000/user (Score:5, Funny)
Re:over $1000/user (Score:2)
The question isn't whether ebay will try to make a profit from Skype, but whether Skype will still be worth anything to users when ebay is done with it.
Re:over $1000/user (Score:5, Informative)
Re:over $1000/user (Score:5, Funny)
1 ringy-dingy
2 ringy-dingy
"Hello, this is eBay calling to tell you about some fantastic purchasing opportunities available exclusively to our Skype customers.
"Yes, sir, I understand that you're eating dinner. No, sir, we do not have a no-call list, as we are not governed by-
"Now, sir, there's no need to be rude. I'll let you get back to dinner.
"... and call you back in five minutes. Every five minutes. Until you die."
Re:over $1000/user (Score:2)
Especially when Microsoft decides to beef up their voice chat in MSN. I fear that Skype will go the way of ICQ when that happens...
Re:over $1000/user (Score:4, Insightful)
I fear that Skype will go the way of ICQ when that happens...
To be honest ICQ went the way of ICQ when ICQ decided to become a big, fat bloated pig that took half a minute to boot.
And MSN (until recent versions anyway) remained quick and functional. ICQ went down because ICQ went the way of WinAmp 3. No need to blame MS on this.
Re:over $1000/user (Score:2, Interesting)
Skype is toast. You heard it here first.
Re:over $1000/user (Score:3, Interesting)
Re:over $1000/user (Score:2)
That sounds reasonable, and I'll gladly admit that ICQ made things easier for the competition, but I remain sceptical. ICQ had the network effect on their side, yet people still switched to MSN (back then still Windows Messenger IIRC). Besides, MSN is now just as bloated as ICQ was, yet people still stick to it, even though there are plenty of quick and functi
Re:over $1000/user (Score:5, Informative)
It's about 2 cents a minute for outbound calls in the US. This is called SkypeOut.
And in order to get an real phone number, you have to pay for SkypeIn, which looks like it is going to cost about $60 a year, though its still in beta.
So, if you make 500 minutes of calls, its slightly more expensive than the Vonage SoftPhone.
If they made it a flat rate for unlimited calls, I'd buy it in a second.
Re:over $1000/user (Score:3)
Re:over $1000/user (Score:2, Informative)
By charging for extras.
I have a number in the US, one in Finland, and one in Sweden. Plus I use it to call out to people with cell phones and land lines all over the US, Asia, and Europe.
I pay for these extras, but it is so worth it.
Maybe next time you should educate youself on a company's business model before you trash it.
More spam calls (Score:5, Insightful)
From the article :
.... eBay is also attracted by the idea of letting its buyers and sellers talk to each other via their computers ...
Personally, I'm not sure that I would want eBay buyers and sellers to contact me by voice. For a start, it means that to buy or sell effectively, you would need to be online a lot of the time.
Plus, once they have your Skype address, it would open up the system to SPAM voice calls pestering you to buy more things that you don't want or need.
Re:More spam calls (Score:5, Insightful)
I've only done around a hundred auctions, but my experience has been that the questions come 18-24 hours before the auction ends. People looking much earlier than that tend to know exactly what they're looking for and don't ask many questions. People looking later than that are grabbing the first thing they see. People in that 18-24 hour time range, though, seem to ask lots of questions trying to figure out whether or not they should bid.
And of course, these people don't even end up winning the auctions. They're the ones who are new to Ebay, don't understand the concept of sniping, think that they're really going to get a Tivo for the $1 opening bid, and even still, they want to ask questions first about the item.
Re:More spam calls (Score:2, Interesting)
Comment removed (Score:5, Funny)
Re:Wow (Score:2)
I quickly learnt why you guys over there are so anti everything-support. If that is what is to come even here I'm sure swedes will start having office-shootings soon too.
Here we go again (Score:4, Insightful)
Re:Here we go again (Score:2, Funny)
Re:Here we go again (Score:2, Insightful)
give us some examples? I'm sure there are some, but what is the reasoning behind it?
in business this is whats called venturing into vertical markets. It's sometimes GOOD for business. Ebay is a good example. Although people may disagree because its cool to hate paypal, but look at ebay and paypal? completely vertical markets, and it works.
Re:Here we go again (Score:4, Interesting)
Not really, as paypal's main reason for existence is paying for online auctions (ie eBay). Sure, paypal has some use beyond that, but you could at least see a link between paypal and ebay.
It's a lot harder to see what Skype has to do with online auctions. What's next, eBay search?
eBay mail(especially as they already have an email like function in my ebay)? ebay news & weather? Maybe it is like others have said and that the link is with PayPal's micropayment system than eBay.
Re:Here we go again (Score:5, Interesting)
You want examples? The whole "diworsification" trend of the 70s and 80s. GM bought a satellite company (Hughes) and a data processing firm (EDS), for instance. See how well that worked out for them. The idea was that they'd use these businesses to ride out the slumps in the economic cycle...in reality, all it did was divert management's attention from their core business.
All of the derived wisdom in business is that you find what your company is great at and put everything behind it. Read Good to Great.
eBay buying Paypal makes sense because there are obvious synergies - you buy something on eBay and pay for it with Paypal (and Paypal was also profitable). Sometimes big acquisitions make sense - Oracle buying Peoplesoft and Seibel, or Ford buying Hertz (though after 15+ years they're now ditching it). Sometimes the deals are more of a stretch...e.g., FedEx/Kinko's and UPS/Mailboxes are both based on a very specific strategy and set of assumptions.
eBay buying Skype makes zero sense to me. If eBay had bought Christie's or Sotheby's, I might understand...but buying Skype is (a) reaching waaaay over to a completely different market where the synergies are very speculative, and (b) investing in an unproven, unprofitable venture with a LOT of cash, reminiscent of the dot-com days.
Re:Here we go again (Score:2)
Re:Here we go again (Score:2)
Re:$2.6 BILLION!!!!! (Score:4, Interesting)
Re:$2.6 BILLION!!!!! (Score:2)
potential for social engineering (Score:4, Interesting)
Skype (Score:2, Funny)
Link to the announcement (Score:4, Informative)
what a stretch (Score:4, Insightful)
They can do that already, for free, using any of the IM and VoIP solutions that are out there. eBay didn't have to buy Skype for that. I suspect most sellers just don't want to be bothered, otherwise they'd list an IM address and phone number.
I'm not even sure why Skype is considered so valuable; the technology is commonplace, and VoIP-to-POTS gateways are offered by many companies. And between the Telcos and Microsoft, any competitor is going to be squashed.
Re:what a stretch (Score:5, Insightful)
So why buy skype? Why shell out 1.3 billion bucks for a piece of software, especially one so commonplace as Skype?
Skype is a great piece of software, but no doubt better can be made. But Skype has other things going for it: A) It's got reasonably secure encryption -- unlike practically every other chat and VoIP client out there. B) It's great at getting around firewalls C) As decentralized as it is, it requires minimal resources -- it hits one IP in Denmark and it's on its way. D) It has 40+ million users, of which 3 million are online at any given time, and the numbers are growing.
So skype delivers a lot of regular users at minimal cost. Heck, you don't even need to run adds on the Skype client itself, if you control the help, community and download pages. Controlling the #1 PC-to-PC VoIP client out there gives access to all kinds of non-obvious revenue streams, very few of which have anything to do with auctions.
reasonably secure encryption (Score:2)
As to the decentralization, if that one sever in Denmark goes down, so does the entire network (since no one will be able to log on.)
It is the best solution if you have to be able to get through firewalls and NAT.
Re:reasonably secure encryption (Score:2)
Online Phone card type thing? (Score:5, Insightful)
What a shame... (Score:2)
I remember when even eBay was a fledgling company, trying to find it's market.
This is bad, because: (Score:3, Interesting)
Time to start looking seriously at the existing competition, small as it is.
Re:This is bad, because: (Score:2)
I don't know in what tiny European country you live, but mine has its own ebay [www.ebay.nl]. If they think that that particular market is lucrative enough for them, even though there is plenty [marktplaats.nl] of [autoscout24.nl] competition [speurders.nl], then I'm sure that they consider the telecom market lucrative enough too.
In short: I wouldn't start worrying just yet
Re:This is bad, because: (Score:2)
probably because it was too popular and some things are sold on marktplaats and are hardly offered on ebay.nl
Re:This is bad, because: (Score:2, Informative)
http://www.gizmoproject.com/ [gizmoproject.com])
Thank You for Killing Skype, eBay (Score:2, Interesting)
Not 2.6 billion, but 4.1 billion. (Score:2, Interesting)
Here, check this out:
http://today.reuters.com/news/newsarticle.aspx?typ e=technologyNews&summit=&storyid=2005-09-12T081656 Z_01_HO227963_RTRIDST_0_TECH-SKYPE-EBAY-DC.XML [reuters.com]
Skype was already naff.... (Score:2, Insightful)
Get yourself a real VOIP provider that uses SIP.
Nuts n' Gum... together at last! (Score:2, Interesting)
I mean you can see where Google's going with their purchases, but Yahoo with Konfabulator and eBay with Skype seem to be pointing in a new direction of desktop application acquisition.
In other news, eBay raises fees 45% (Score:2, Insightful)
Re:In other news, eBay raises fees 45% (Score:3, Insightful)
Re:In other news, eBay raises fees 45% (Score:2, Interesting)
Comment removed (Score:4, Insightful)
angling for the unknown (Score:3, Insightful)
Is eBay the new Google? (Score:3, Interesting)
eBay, for the most part, has stayed under the radar (at least, as far as corporate purchases are concerned.) However, even before they started buying things, they already had their hand in every consumer goods market with the U.S. and every other country (though not directly.)
Then they bought PayPal (what, a year ago?). This transaction made plenty of sense, as PayPal was used to pay for many of the auctions on eBay.
But now that eBay is getting Skype, are we seeing a clever purchase or the beginning of a buy-frenzy? This layman cannot see an overall connection between Skype and eBay/PayPal (aside from being general commerace tools); but that doesn't mean they can't buy Skype. And if they purchase Skype, what might they put their grubby mitts on next?
Communications? (Score:2)
E-Bay's use of communications suck all of their products and services are closed products, Skype is no different in that respect, but I see no way that this will improve their buisness. I really can't wait to get back to the closed days of compuserve 195782,1124!
what currency? (Score:3, Insightful)
thats in Yen right?
seriously why dont ebay hire some people to make a SIP compliant client + service...
the only reason why skype is doing well at the moment is because SIP hasn't taken of yet...
Ebay is not an auction company (Score:5, Insightful)
It sounds to me like ebay is trying to transform itself into a "business solutions provider" company. Starting a small business? Sell your stuff using ebay with "buy it now". Want to accept credit cards and do other business banking? We can do that. Want to offer a toll-free (or non-toll-free) number to your customers? We can do that, too.
I would not be overly surprised if they went after Quicken or a competitor next. Possibly even a shipping or storage company, too (but less likely since those aren't virtual).
Large Techs Making VOIP Plays (Score:5, Informative)
Just recently, Microsoft purchased Teleo, which will allow MSN messenger users to make PC-to-Phone calls. Yahoo purchased Dialpad, which has similar capabilities to Skype (PC-to-PC and PC-to-Phone). And of course Google introduced Google talk, which is the first step in the process. eBay just doesn't want to be left out.
This is not really my insight. See for example:
http://news.ft.com/cms/s/d1218d8c-2097-11da-81ef-
The Key is not Ebay but Paypal. (Score:5, Insightful)
Ebay's interest in Skype has nothing to do with augmenting their auctions with calls between buyers and sellers. This is about taking those (alleged) 50 million non-paying Skypers and giving them an easy, more attractive way of paying for individual calls rather then stumping up $5. Pretty much everyone has a Paypal account and this sort of tie-up would get them using both Paypal and Skype more, with people more willing to leave cash sitting in their Paypal accounts because "I might need it for calls". This would consolidate Paypal's dominant position, something Ebay are probably anxious to do in the wake of rumours of a Google e-payment service - most people will only really bother with one payment service and, if it covers their phone calls too, sticking with Paypal will be a no-brainer.
The real killer argument for the Paypal/Skype tie-up is, however, the possibilities it opens up for a whole new generation of premium phone services and the recent repositioning of PayPal, missed by many, strongly suggests that Whitman et al realize this - after years of holding back the whole idea of micro-payments, they finally decided to granularize Paypal's fee scale, making 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 a whole new layer of services. I don't think the timing of that introduction is a coincidence. I believe that Paypal are preparing the ground so that anyone who wants to set up a premium number can do so via Skype - if someone fancies themselves as a fortune teller, a Windows guru, a phone psychologist, a language translator, anything at all that can be conveyed over the phone, Skype will allow them to receive calls for which they can charge whatever they want per minute, taken directly from the customers Paypal account.
The rakes that the traditional telcos cream from premium calls are obscene, resulting in unattractive overall rates, crippling a potentially huge homebrew industry before it even began. Seriously, how many of you regularly turn to premium phone-lines when you have a problem? I can definitely understand how talking to another human being, one expert at tackling my particular problem, could be useful - the current cost, however, takes that option right out of contention. Generally, too, a premium service can only serve one country, barely giving it room to breathe market-wise.
A Skype/Paypal solution would be international, meaning a techie in Bombay could build a reputation for solving computer problems for customers in Baltimore, more easily than getting the kid down the road to drop by and certainly more cheaply than phoning Compuworld or Apple. It would also allow that kid in Bombay to keep a meaningful percentage of his per-minute fee, allowing him to keep it low. You would soon have a massive market of providers, ranging from amateurs to highly experienced professionals, all promoting their services via websites and forums, all adapting their charges and services to market conditions. By building the charging mechanism right into Skype, Paypal would find itself sitting happily in the middle of a new explosion of cash transactions.
Just like Ebay did.
Re:The Key is not Ebay but Paypal. (Score:2, Interesting)
A Skype/Paypal solution would be international, [...]
I don't know about that - here in Germany, premium phone services are heavily regulated (why? I don't really know; I guess just too many crooks abused them and found too many fools to pay them).
I assume Germany is not the only country in the world where this is the case.
But for the US and other less regulated economies, your idea sounds feasible.
Re:The Key is not Ebay but Paypal. (Score:4, Interesting)
I'm not saying that the German government can't throw a spanner in the works, I'm saying that they won't.
Politically, no Western government is going to engage in a drawn-out witch-hunt, mandating the involvement of banks and credit cards companies.
To draw a relevant comparison, European companies have still not managed to universally enforce VAT collection despite threatening to sue American service providers selling to European customers. They are willing to chase that because it's huge money, potentially 15-20% of transatlantic commerce, but it hasn't been easy or very successful.
Notice that they have chosen not to pursue the simpler path of accessing their citizen's bank account and adding a VAT charge to every online service transaction. This is because there are very real blocks, both cultural and legal, that, for the most part, render bank accounts sacred - such access would force to rich to shoulder their fair share of the tax burden and that will never be allowed to happen.
In the case of pursuing the much smaller fish of premium phone services, the only electorate that actually like to see their government flying in the face of the advances that the Internet allows are the French. Every other government knows that stopping their people from benefiting from better services and lower prices is a vote loser and, at the end of the day, that's what it's all about.
BTW, Paypal/Ebay will, absolutely, collect VAT on behalf of European governments, Skype already adds it to your top-ups if you don't have the foresight to say you don't live in Europe. All I'm saying is that the premium phoneline providers are going to lose their monopolies and, with their passing, the market will bloom.
Re:The Key is not Ebay but Paypal. (Score:3, Insightful)
Re:The Key is not Ebay but Paypal. (Score:2)
Over the years, I've developed an increasingly pragmatic approach to Internet services; I've had a Paypal account pretty since it began but have never been
Another one bites the dust... (Score:2, Interesting)
If (Paypal) Then find another VOIP provider (Score:2)
Chip H.
Well gee, that was unexpected... (Score:2)
Let's hope Skype doesn't go the way of Kazaa :)
regarding firewall traversal (Score:3, Informative)
1) If the number of machines without firewalls starts to fall dramatically skype users are SOL. This could happen if most PC's have an automatic firewall enabled or broadband providers start shipping modems with built in firewalls.
2) I don't know about you but it's a bit odd routing my voice traffic through non authenticated computers - encryption be damned.
3) Routing around firewalls provides a *good* calling experience but not reliable. Skype calls can drop on you randomly. You also can have trouble connecting when you want to call. While skype is great for people who want high quality calls that work most of the time, it isn't really great when you try on rely on it.
I use skype and think it is a great product... but I don't quite understand how it people think it is worth so much money as a company.
Re:At least... (Score:2, Funny)
Re:Possibilities... (Score:3, Funny)
I thought we'd got over the dotcom madness?
Re:Possibilities... (Score:5, Funny)
For things worth actual money?
I bid grgle-snrt I bid zzzzffff No, I bid kkkppp No first f-f-f-f-first! twenty eeeehooonnnggg but wait a wawawa twenty-eight pork
Great idea, boys.
Re:Hmmm... (Score:2)
I am not advocating skype here, but do check your facts before posting.
Re:Hmmm... (Score:3, Interesting)
Sitting in front of a PC and being able to talk to someone is so 1999.
Re:Except it doesn't bloody work! (Score:2)
Re:What is so special about Skype? (Score:5, Insightful)
- Skype has little or no problems with firewalls. Most workplaces wouldn't be able to use Skype if it wasn't for this.
- It's not only PC-to-PC, which indeed is a dime a dozen. It's also PC-to-phone and even phone-to-PC. You can get your own phone number(s) in some countries, e.g. get yourself a phone number in some other country and your friends there can phone you at local rates instead of international.
- With the latest version and its forwarding feature (still only in the Windows version) it's even phone-to-phone as well.
- Skype's PC-to-phone is cheap. I can go to the other side of the world and phone my mum or anyone at home for close to nothing, with a USB stick w/Skype and an Internet cafe.
There are other applications out there that can do part of what Skype can do, but it's either
- missing some features, or
- not as good PC-to-phone country coverage, or
- more expensive PC-to-phone rates, or
- none or extremely (even more than Skype) limited availability of phone numbers (what Skype calls SkypeIn).
- a smaller user base (which is a self-strengthening point)
In other words, a lot of stuff come together in Skype. The only point against I can think of is the missing interoperability with other software because of the proprietary protocols.
Re:1997 insanity? (Score:2)