Let's Talk About Skype

I read Nick Carr’s thoughts last night and commented on them.

Then I saw Jeff Pulver’s thoughts this morning (via twitter).

I agree with much of what both of them say about Skype, but I think it just comes down to wrong guy married wrong gal.

A couple days ago, a reporter asked me via email:

I’m curious about eBay’s big Skype write-off, which (along with Vonage’s problems), suggests that "free" isn’t much of a business model when you can’t easily rely on advertising (which seems to be the case in telecom). You agree?

And I told the reporter:

I think Skype is a great business that is owned by the wrong company.

I wouldn’t jump to conclusions based on what eBay’s done with it to date.

Like everyone else who was blogging two years ago, I went back and looked at what I wrote at the time.

But why does eBay want to own Skype?

Forget for a second the rumored price of $2bn to $3bn.

What’s in it for eBay?

This quote is from the Wall Street Journal’s story on the rumored deal:

Skype offers the Internet auctioneer a thriving
e-commerce business that benefits from so-called network effect, which
is a good or service that has value to a potential customer based on
the number of customers who already own that good or use that service,
said this person familiar with the matter.

Yeah, so what?  I still don’t see the synergy in the deal for eBay.

Back to the purchase price.  I think Skype is a bargain at $2bn to
$3bn.  I think everyone should use Skype and I think it will be on
every kind of communication device over time – cellphones, PDAs, etc.

I think Skype could be the ultimate phone company of the 21st century.

So owning Skype makes sense.  But I am not sure why it makes more
sense to eBay than Verizon or BellSouth. 

For me it comes down to what I said on Nick’s blog last night.

i can’t help but think that the wrong company bought skype. imagine if Nokia had bought them or even Verizon or even Google.

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