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Summary:

[qi:090] Skype, the P2P voice service that cost eBay billions of dollars, might be up for sale, according to The Guardian. Currently in favour around London’s webbist community is the rumour that Google has been in negotiations to buy Skype, the web telephony firm, from eBay. […]

[qi:090] Skype, the P2P voice service that cost eBay billions of dollars, might be up for sale, according to The Guardian.

Currently in favour around London’s webbist community is the rumour that Google has been in negotiations to buy Skype, the web telephony firm, from eBay.

With most of the old Skype team — including co-founders Niklas and Janus — gone, these rumors are bound to surface. There are questions about how much more Skype can grow. In short, SkypeBay is in flux, and hence the rumors. I am checking with my sources and have emailed Skype PR as well to get more details. Stay tuned. (via)

Update: Skype spokesperson just got back in touch with what has to be the funniest denial email I have ever received. Good to see that Skype is getting a thick skin:

What would we do without rumors?! We’re sure that someone is using Skype right now to give new life to old ones and create new ones from scratch. We certainly understand it — after all, Skype is about making conversations possible. That said, we don’t comment on rumor on speculation (beyond what we’ve just said).

Update #2: Kevin points to a little known provision that might prevent any deal from happening till next year.

eBay agreed that if, on or prior to March 31, 2008, eBay sells or transfers securities representing greater than 50% of the outstanding voting power of, or economic interest in, Skype or all or substantially all of the assets of Skype and its subsidiaries, taken as a whole, eBay or Skype Lux would pay up to an additional €138,411,300, or approximately $195,159,900, in the aggregate to the Earn Out Sellers and the Earn Out Representative….

  1. I think its a good move on google’s side if they were to buy skype. Skype is already a very strong brand and with the new android on the horizon, it cannot get scarier for other carriers.

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  2. Can’t comment on the speculation, but I would be happy to see this acquisition occur. I think Google is a better much better steward for voice than Ebay.

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  3. I bet Google could get Skype at a firesale price. :) You have to love the rumour mill!

    Mark

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  4. Kevin Kelleher Monday, November 19, 2007

    One reason to think that any sale may not happen until at least next April is this little-noticed provision in eBay’s announcement on Skype in October.

    “eBay agreed that if, on or prior to March 31, 2008, eBay sells or transfers securities representing greater than 50% of the outstanding voting power of, or economic interest in, Skype or all or substantially all of the assets of Skype and its subsidiaries, taken as a whole, eBay or Skype Lux would pay up to an additional €138,411,300, or approximately $195,159,900, in the aggregate to the Earn Out Sellers and the Earn Out Representative….”

    http://sec.gov/Archives/edgar/data/1065088/000089161807000579/f34172e8vk.htm#000

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  5. 400 million revenue, and you think it will be a firesale? 4 billion is what Blodget is guession, and he says it could go higher with M.S. getting a whiff.

    http://www.alleyinsider.com/2007/11/ebay-selling-sk.html

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  6. I’ve always thought the only way Skype can derive value is from Google’s ad system. It makes sense that Google either partners with or buys Skype. Buying makes more sense now that we know Google is serious about telecom.

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  7. How would this tie into the GrandCentral purchase they already made?

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  8. Things are getting funnier by the hour. In other news “AT&T: Not Too Worried About Google Wireless”

    If Skype acquisition takes place and Google Wireless plans get green light I cant stop but smile at AT&T becoming the dumbest pipe, oh forgot the mobile thing – I also meant moving pipe :)

    It surely looks like a huge stretch , but just thinking of it makes me feel even better.

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  9. What a great quote form skype, they promoted their own product, and coyly avoided denying the rumor. It’s a brilliant quote actually. Give the person who wrote it a raise.

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  10. According to Jesse Chan (http://fishtrain.com/2007/10/30/google-worth-more-than-rest-of-the-big-web/), as of last month, Google has “no debt, and over $13b in cash and marketable securities”. Let’s assume they can increase their debt to about 2.5 times earnings, that’s 2.5 x $4b = $10b more. So a total of $23b to invest…
    And, don’t forget that Google has already been rubbing shoulders with Skype for some time now; they dove into the FON.com project hand-in-hand years ago.
    My opinion: if Skype is really up for sale, Google would make for a great adoptive parent. And we all know that Skype is not done growing.

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