eBay and Skype a done deal

Tom Keating : VoIP & Gadgets Blog
Tom Keating
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eBay and Skype a done deal

Rumors were laid to rest when eBay announced that it plans to acquire Skype by paying $1.3
billion in cash and $1.3 billion in stock. It also has performance encentives in the deal that would make a later payout of up to $1.5 billion by 2008 or 2009 if financial targets are met, giving the deal a total value of up to $4.1 billion.

I wasn't crazy about the idea last week over eBay paying >$3 billion for Skype and I'm still not crazy about it now. I would not be a happy eBay stock holder right now, my guess is the stock will drop a couple percentage points, so it will be interesting to see what eBay's stock does when the markets open.

Then again with plenty of market hype surrounding VoIP, I'm sure the stock traders and insiders will probably be heavily pushing their clients to buy eBay at the opening bell. "VoIP is hot right now. You can't lose!"

Uh huh, we've heard that before.

I am happy for Mr. Zennstrom who will become a billionaire overnight and I thank him for creating one of the coolest Internet applications ever created. But eBay stockholders? You've been had.

I suppose eBay had a few billion dollars to burn. I still think they could have done what Google did and develop their own VoIP softphone for a lot less.

Rich and Greg have some insights on the eBay & Skype deal you should check out


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