EBay Admits To Bad Call On Skype 297
MaineCoasts writes "The Times online reports that two years after buying Skype for 2.6 billion, Ebay yesterday warned shareholders that they may have made a mistake. In essence, they vastly overpaid for the company. ZDNet offers analysis of the announcement: 'Clearly, the current business model is not enough to satisfy eBay in light of how much the company spent on Skype. And the reason is simple. Even though Skype has done a very good job of getting users to download its software client, most people who use the service do so to make free Skype-to-Skype phone calls. The only way that Skype makes money from its subscribers is when people use its Skype-In or Skype-Out services. Skype-In allows users to pay to rent a phone number, which people on regular phones can call. Skype-Out allows users to call traditional phones or cell phones for a fee.'"
Pretty obvious, wasn't it? (Score:3, Informative)
Re:Bubble (Score:5, Informative)
There was no point for them to invest so massively in such a service.
Who cares about Skype? (Score:3, Informative)
Skype-Out great for International Calls (Score:3, Informative)
Now in comparison, I spend somewhere between £50-£90 per month on my mobile phone. The amount largely depends on whether I've traveled out of the UK that month. With wider adoption of VoIP services on mobile devices, for sure my cell phone bill would drop and a portion of the money would siphon across to my Skype account.
The final thing holding me back from spending more on Skype is the expense and poor quality of the "phone" devices available. I spent £100 about a year ago on a Skype Wi-Fi phone. No need to have anything connected to my computer, the phone's base unit was supposed to connect directly to my wireless router and behold, I have Skype calls very easily. Unfortunately, after waiting almost a month for my order to be fulfilled, within 3 weeks the phone unit died. I gave up trying to get a refund from Skype and trashed the thing. So far I've been reluctant to spend a similar amount on a device that may die again quickly and have to deal with Skype customer service.
Re:SIP VoIP vs Skype (Score:2, Informative)
In my experience, the voice quality of Skype has been pretty high. Better than a cell phone, not as good as a land line. What sold me, though, was the incredibly cheap rate. For unlimited Skype-in and Skype-out in the US and Canada, the price is $30/year. That comes out to $2.50/month for unlimited calls, which is an INCREDIBLE deal.
I spent time searching for a cheap SIP plan, but there's nothing even remotely that cheap. About the cheapest rates you can find are 1.2 cents/minute for the 48 continguous states. Hawaii usually costs a little less than twice as much (which matters to me since I have family there).
With just a little bit of simple math, you'll notice that if you talk on the phone for more than 3.5 hours per month, the SIP plan becomes more expensive than Skype. Sure there are unlimited SIP plans, but they are usually in the $15/month range or higher, which is just ridiculous compared to Skype.
Skype may have some problems, but when it comes to price, no one can even come close.
Clearly it's the version number. (Score:3, Informative)
Re:SIP VoIP vs Skype (Score:3, Informative)
As you use SIP, I was wondering if you had any advice towards getting a decent wireless SIP phone and a good provider. I don't want to run a PC with Asterisk on it at home if I don't have to, but there -is- one that's always on that I could use, if necessary. (I'd kind of like to play with it, but time and effort and all that.)
Also, have you tried the Gizmo Project? I was looking at it because it integrates well with Grand Central and is 'open', but then I found http://gigaom.com/2005/07/04/gizmo-project-not-that-open-after-all/ [gigaom.com]
Re:SIP VoIP vs Skype (Score:3, Informative)
We use Skype a lot where I work. We've also experimented with Asterisk. The call quality with SIP is significantly lower than Skype, at least over low-bandwidth Internet connections (which we deal with frequently). Sounds like you've had a different experience, but for now, we're sticking with Skype, and watching this situation very closely....
Re:What's the prob? (Score:3, Informative)
"division also recorded its second quarterly profit in a row on July 18 on revenue of $90 million."
The $90 million is revenue, not profit. There is no indication of what the profis is.
Re:You're Going to See a Lot of Criticism (Score:4, Informative)
They later changed the name and refocused as the dot-com bubble collapsed and the 'AOL' part approached worthlessness in evaluation, and the company didnt exactly need the loadstone of a posterboy for the bubble as a name.
As to the flash-forward, the merger structure and name changes makes it fairly difficult to figure out exactly who the most stupid party was, but anyone left holding stock in the joint company probably had more left than if they'd been holding only AOL stock. Which doesn't exactly make them less stupid for touching AOL stock at all.
It's sortof sad how the high-flying corporate execs appear to have learned very little about how to avoid getting brainslugged by clever marketers.
Resurrect skype for ebay?! (Score:2, Informative)
After all, it is not impossible for ebay to use skype effectively even if skype is not profitable independently. Just imagine,
1) assign a free skype account for each buyer or seller (match skype id to ebay id?)
2) add a voice message feature to My Ebay (maybe, record conversations as well?)
3) associate voice messages/conversations to transactions
4) resolve disputes with voice messages/conversations
5) how about a little fee for such a convenient service in order to safe-guard the interests of both buyers' and sellers'.
Well, I may pay a few $$ for this additional 'insurance' for a transaction of a few hundred $$.
Re:Don't be short-sighted (Score:3, Informative)
Re:SIP VoIP vs Skype (Score:3, Informative)
As for Gizmo, get a short account and give it a whirl. It is not that expensive. I am happier with the quality of Skype out and otherwise (Skype to Skype) use it for talking to family overseas. There are other SIP providers such as OpenWengo. I may try them. If all else fails, I will move to Skype.
Re:Bubble (Score:3, Informative)
In a bubble, every shmoe on the street is buying something, completely ignoring things like revenue, saying "this time it's different," or "this can never go down." This sort of thing seems to happen about once per generation--most people need to learn their lessons the hard way.
One bad investment--hell, even hundreds of bad investments--just can't send a typical market in to serious, long-term slide. You have to have a bubble to begin with for something to pop. Until your retarded, red-neck cousins start talking about day-trading at family reunions, you don't need to worry too much about stock bubbles.
Remember when cousin Jed, the one with with that nappy mullet, was talking about flipping houses at last year's thanksgiving dinner? That's a pretty good bubble indicator, right there.
Re:You're Going to See a Lot of Criticism (Score:3, Informative)
Skype-based SIP servers (Score:3, Informative)
I almost put this exact recommendation in my post. Then I found it already exists: