Thursday, October 20, 2005
Is eBay Buying Hype Or Skype
I still don't understand the eBay buying Skype or hype story. If I have this correct, eBay is buying a company that provides free long distance calls(COMMODITY) through VOIP in a space that has no barriers to entry.
Did I miss that day in Business School that said this was a good business model?
From Reuters Voice phone calls to be free within years
"The percentage of users that you can actually charge for (phone services) will actually go down, so I actually agree with that and we understood that when we looked at Skype," CEO Meg Whitman said in responding to the analyst's question of eBay's $4 billion purchase of Skype Technologies.
With so many analysts questioning this decision, I think this will mark a key point in eBay's future.
I can see buying the 57m registered users, but I can't see paying that price per user.
No. I don't use ANY VOIP service yet. My cell service plan has a truckload of minutes for so little and if I call overseas I use a calling card. I have programmed the phone to dial the codes before the call so it's easy and I never lose a signal. (Yes I know a calling card uses VOIP).
I will subscribe to VOIP through my cable company when they offer it.
Why would I pay for it? If it breaks I call the cable company. I don't have to install or wire anything.
Am I missing something with this Skype acquisition?