Ebay to spin off Skype with IPO

In September of 2005, Ebay bought Skype for 4.1 billion dollars; a massive amount of money for a company that had many suitors. Even after Ebay won the bid for the company many were left wondering how Ebay would integrate Skype into its services effectively.

The answer to that question is... they couldn't. Ebay has announced that it will spin off Skype with an IPO (initial public offering) to separate the services that were never meant to be meshed together.

The original founders have tempted to buy back Skype but Ebay rejected the offer because they felt Skype was being undervalued. With Ebay removing Skype from its business model it will allow the company to go back to its core assets and no longer have to worry about trying to merge with a product that seemingly didn't fit.

This case will probably be studied by many future MBA students in the future as a merger of two companies that had nothing in common. It's surprising that it lasted this long but the end results were predicted by many.

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The valuations put on Skype by analysts from banks, brokerage houses and other miscellaneous basket cases were amusing. Made me wonder if Ebay is planning to buy a bank with the proceeds. If they wait till 2010 it will be deja vu all over again.

Bad idea #1 :Buy Skype (cause it is not part of eBay business).
Bad idea #2 :Try to sell it during the economic crisis.
Good Idea #1 : (sub) speculate then sell it as bargain and buy it by yourself using a associate / paper company.
Good Idea #2 : Rinse and repeat.

Who wins : who is doing it.
Who lose: Shareholders.

When eBay took over Skype, I thought they might attempt VoIP-based auctions mimicking real-life auctions. Obviously that didn't quite pan out but it was about the only reason I could think of. In any case, $4.1 billion was way too much money for acquiring the necessary tech.

Actually Skype does SIP trunking now and all of the voip pbx's I am familiar with already supported using skype as a trunk before anyway.

Skype doesn't use SIP so is not a true VoIP service. Its the iPhone of VoIP always trying to be the better product but completly disregards the standards and does things its own way. I am not saying it is a bad product by all means. I just hat ehte fact that to get hardware intergration you go and by a Skype Phone, and then want to move to another VoIP provider, you can't cause the Skype phone doesn't support SIP.

There's nothing to say that a VoIP service must use SIP to be a 'true' VoIP service - that's utter nonsense. I'm not saying ignoring standards is a good thing or that Skype implementation is the 'correct' one, equally, the same cannot be said of SIP. But Skype is a 'true' VoIP service.

It will be interesting to see how much they get for it.
If marketed correctly skype could really take of as VOIP usage is really growing in the small business sector.
Skype has THE name for that tech.

It will only get mass market appeal if it becomes interoperable and that isn't on Skype's roadmap...

Everyone is jumping to VoIP (Cell Phone Operators, Traditional Phone Companies, Cable Companies, etc.), but due to Skype's locked format no one is using them. And even worse only a very small subset of VoIP hardware supports skype...

Hard to build a monopoly in a competitive market before consumers are actually hooked on your product. People are hooked to Skype for VoIP from their PC, but they don't see a Skype connection OFF their PC. That is where the real money is... Probably why eBay is dropping them as they've failed at that transition.

What's new there? lol However, as a Skype user I am concerned about its future - I really hope this "spin off" doesn't affect the service after its promising recent history. Skype 4 for Windows, Java for Mobile, and PSP versions have really made this service shine...

happymonkey said,
What's new there? lol However, as a Skype user I am concerned about its future - I really hope this "spin off" doesn't affect the service after its promising recent history. Skype 4 for Windows, Java for Mobile, and PSP versions have really made this service shine...

Its amazing how mis-reading just one letter in that last word like I just did can change the entire angle of the statement lol