eBay's purchase of Skype in 2005 was perceived as one of the tech industry's biggest failures. eBay never figured out how to integrate Skype with its core business and has failed to find a way to monetize the potential of the Internet VoIP (voice over IP) service. The deal announced today, in which eBay has sold Skype for $1.9 billion while retaining a 35 percent stake in the company, is a win for both eBay and Skype.
eBay gets to unload an entity that has just not meshed with what eBay does. The original vision apparently involved leveraging Skype VoIP functionality for some sort of click-to-talk feature on the eBay auction site. That vision was never realized and Skype, while it did account for about $550 million in revenue last year, has not been able to reach its potential under eBay's direction.
The deal, valued at $1.9 billion for a 65 percent stake of Skype, also retains much of the original investment value- basically letting eBay get back most of what it paid for Skype so the experiment wasn't a complete waste of money.
More: http://pcworld.com/businesscenter/blogs/bizfeed/171263/
eBay gets to unload an entity that has just not meshed with what eBay does. The original vision apparently involved leveraging Skype VoIP functionality for some sort of click-to-talk feature on the eBay auction site. That vision was never realized and Skype, while it did account for about $550 million in revenue last year, has not been able to reach its potential under eBay's direction.
The deal, valued at $1.9 billion for a 65 percent stake of Skype, also retains much of the original investment value- basically letting eBay get back most of what it paid for Skype so the experiment wasn't a complete waste of money.
More: http://pcworld.com/businesscenter/blogs/bizfeed/171263/