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?

1 comment:

Anonymous said...

Mass hypnosis of EBay mngt.