Sep
12
2005eBay Buys Skype
12
2005
So, eBay is buying Skype - for $2.6 Billion dollars. Skype’s 2004 revenue? $7 Million.
Perhaps eBay assumes that its general hugeness will magnify the profitability of Skype a hundredfold, but guess what?
Sure there’s a whole lot of “fudge” built into those numbers, but the point is they’re already on the same order of magnitude. I think eBay’s in for a rude awakening. The “Post-Post-Bubble Web” is about small companies executing on big ideas, happy to make a modest income (because they stay small). It’s about Flickr and Blogger and Craigslist (which “got it” even in the pre-Bubble days).
Skype is an awesome technology, it has an amazing user base, and it makes a decent income. But, don’t think that taking a small tech business and glomming it onto a big one is going to automatically greatly magnify its value. Whatever marketing clout eBay has is nothing compared to the word of mouth that propelled Skype’s user base into the stratosphere.
Of course, I’m sure the 150 employees of Skype are quite happy to divvy up that $2.6 Billion. I hear that kind of money can go pretty far in Luxembourg and Estonia.