Rumor Mill: Google Buying Skype

I have to be honest with you my loyal and devoted readers. I am disgusted with myself. Why you ask? Because I am an addict – I am addicted to writing about Google. I just can’t seem to help it. They are in the news and in every hot sector. Even when they aren’t making news in a sector they are implicated in rumors which I must explore in order to do my job effectively.
 
I haven’t wanted to touch the latest rumor because I just wrote about the Google/Sprint acquisition rumors and in doing so got tremendous heat from many in the blogosphere because the rumor did not have solid facts behind it. Others said regardless of my sources this deal could never happen.
 
Perhaps starting the headline of said post with the words ‘Rumor Mill” doesn’t get the point across. Next time I may have to try something stronger.
 
In the mean time the latest Google rumor mill acquisition target is Skype.
 
This makes sense for eBay because I am pretty sure they have no idea what to do with Skype. As a standalone company Skype has done a good job these past years but they make little money and missed revenue goals.
 
In a recent article I asked out loud (well in print anyway) why Skype doesn’t run ads on the service. This is a no brainer if you are looking for revenue.
 
Here is an excerpt from the article:
 
Show some ads: Let’s see if I understand the situation. You have over 5 million users on your service almost every moment of every day. You need to increase revenue. Your answer? Show no ads. If I were eBay I would be flashing product listings in front of Skype users as often as possible. If this doesn’t make sense, why not show Google ads like everyone else in the world? It is tough to see where this isn’t a $100 million/year revenue opportunity – this amount may seem high but think about how long people use Skype each day and consider you can flash new ads in front of users constantly. Moreover, probably $90 million would flow to the bottom line. eBay’s P/E ratio is currently about 40 so this amount of earnings could translate into about $3.6 billion in market capitalization. Not showing ads is something I can’t conceivably understand.
 
You don’t think there are 100 propeller heads (said respectfully – I am a fellow propeller head) in the Googleplex working on speech recognition right this moment so if they acquire Skype they can immediately run contextual ads based on what you are talking about?
 
Wait till the privacy zealots get a hold of this news. It’ll be front page news in The New York Times for sure.
 
But I digress. Google needs voice and voice for that matter needs Google.
 
Even AT&T has learned how to be nimble and quick and as of today owns a pay-per-call company. Google too must look for new avenues of revenue growth and millions of Skype users make fertile ground for new VoIP-based contextual ads.
 
What are the odds of such a merger happening? I would say from Google’s standpoint there is a 100% chance that Skype is something the company wants. The question is will eBay part with the world’s largest software-based telephone company? My feeling is if they haven’t figured out how to integrate or monetize Skype yet they may never figure it out. Moreover, selling to Google makes sense for all involved and also allows the talented Skype team the ability to really monetize their platform in a meaningful way.
 
eBay for its part might even get some concessions from Google in the deal, ensuring that Google doesn’t compete in any significant way with PayPal.
 
Although no one at Skype has told me a sale is imminent, my spider senses are indeed tingling and I do get the feeling some change is afoot. Time will tell of course and if you are ready to blast me (I mean send me a respectful letter of course 🙂 ) for starting unsubstantiated rumors I would like to point you to at least one other site which had this rumor posted before me.

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