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Size Does Matter: But Can Even eBay Turn the Skype Model into Revenue?


DUBLIN, Ireland -- Research and Markets (http://www.researchandmarkets.com/reports/c24569) has announced the addition of Size Does Matter: But Can Even eBay Turn the Skype Model into Revenue? to their offering.

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The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion.
2.6 billion acquisition of Skype announced by eBay in September 2005 is the latest of a number of headline-grabbing ventures into VoIP territory by Web properties, including Google's launch of Google Talk Google's instant messaging (IM) service, which provides text messaging and voice calling. It provides a link to the user's Gmail account as well as displays the number of unread messages in the inbox.  and Microsoft's acquisition of Teleo (both in August 2005), and Yahoo!'s acquisition of Dialpad Communications in June 2005. This paper analyses eBay's announced acquisition of Skype.

We are generally sceptical about the deal (in particular the price), though, according to according to
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, Principal Consultant, there are parallels with two high profile deals from the 1990's dotcom era, notably:

--Microsoft's purchase of Hotmail for USD400 million in late 1997. Hotmail had 10 million non-paying users, and it also had very rapid exponential growth Extremely fast growth. On a chart, the line curves up rather than being straight. Contrast with linear. .

--AOL's acquisition of Mirabilis' ICQ ("I Seek You") A conferencing program for the Internet from Mirabilis, Tel Aviv, Israel (www.icq.com). It provides interactive chat, e-mail and file transfer and can alert you when someone on your predefined list has also come online.  Instant Messenger AOL's instant messaging service. See AIM and instant messaging.  for USD 287 million in June 1998, when ICQ had 12m non-paying users (and, again, very rapid growth).

The eBay/Skype deal is not out of line with these earlier acquisitions.

According to these forecasts, there is evidence that individual usage levels for Skype have turned a corner - average MoU per registered subscriber is falling, and the number of simultaneous users has flattened out. This may be a seasonal effect common to all fixed voice, but it is not what one would expect of an immature technology.

Rupert Wood, Principal Analyst, believes that Skype needs to break out of the natural demographic limits of the PC-to-PC market, which is limited by IT literacy. He also believes that to charge, Skype would have to expand its user community substantially - well beyond the current low single-digit penetration levels of telephony users. However, the eBay deal pushes Skype towards a slightly more defined user community: some 157 million registered online traders. But it remains to be seen whether it is defined enough, or of sufficient interest to online traders (as opposed to email), or has sufficient overlap with private voice application communicators to justify the price tag as a value-add application to eBay.

For more information visit http://www.researchandmarkets.com/reports/c24569.
COPYRIGHT 2005 Business Wire
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Copyright 2005, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Publication:Business Wire
Geographic Code:1USA
Date:Sep 21, 2005
Words:366
Previous Article:Optical Keyhole Interviews Avici Systems CEO.
Next Article:Launch of Retail VoIP Services and Take-up of those Services has been Strong in Some European Markets while Nearly Non-existent in Others.
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