Tuesday, September 1, 2009

Buyer's Remorse

eBay plans to announce later today that it has reached a deal to sell "Skype," its internet telephony subsidiary, to a group of private investors (including an eBay director). The purchase price has not been disclosed, but eBay has said it wants around $2 billion for Skype. eBay acquired Skype in 2005, outbidding Google and Yahoo in a deal that has come to be viewed as one of the worst technology transactions of the decade, according to the New York Times. The price then ultimately topped $3.1 billion. After it later became clear that the company was not a good fit with eBay’s main auction and Paypal businesses, eBay wrote down $900 million of Skype's value.

This reminds me of the old joke, "How do you become a millionaire offering a free service that lets users talk to each other via computer?"

"Start as a billionaire."

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