Skype up in the sky for e-Bay.(World)(Skype Technologies S.A.)(Brief article)

In 2005, e-Bay Inc. spent $2.6 billion to purchase Skype, a software application that allows consumers to make domestic and international phone calls and conduct teleconferences over the Internet. The thinking at the time was that an Internet calling and video service would help buyers and sellers work out details of an auction, particularly in international sectors like India and China where e-Bay was expanding.

Overall, the partnership has been deemed a bit of a failure. Apparently, e-Bay buyers and sellers prefer to communicate via email, and the merger proved to be a strain on company management's time. Further complicating matters, e-Bay has been struggling to maintain its own footing in the e-commerce marketplace as rival Amazon Inc. gained market share. As a result, e-Bay has now decided to spin Skype off as an initial public offering (IPO) in 2010. e-Bay spokesman Alan Marks said the company chose to go the IPO route because "we think that's what is going to maximize value for Skype and for e-Bay." It has been reported that Skype's founders, Scandinavian entrepreneurs Niklas Zennstrom and Janus Friis, expressed interest in buying the company back.

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