The fight for Skype has ended. After weeks of nasty legal sparring, the Internet telephony service’s founders agreed to join the investor group purchasing it from EBay and dropped the lawsuit that had threatened to bollocks the deal.
If eBay shares were to be listed among the company’s other auctions, buyer feedback would more likely be negative than not. Hurt by the souring economy and increased competition, eBay reported its third consecutive earnings decline Wednesday.
Analysts value Skype at roughly $2 billion. But John Donahoe, CEO of parent company eBay, values it at more than that. Asked to put a price on the Internet telephony business, Donahoe declined, but he said $2 billion is “low.”
“Skype is a great standalone business.” That’s how eBay CEO John Donahoe described the company’s anomalous Internet telephony unit during its recent earnings call, and that remark is being interpreted by some as a signal that the online auctioneer is looking to unload it. Frankly, that wouldn’t be a bad idea.
Good thing Wall Street’s expectations for eBay’s fourth-quarter earnings are low, because the online auctioneer is gearing up to post what many believe will be its first quarterly revenue decline in nearly 10 years. With its auction business slowing and the deepening recession playing havoc with its now year-old turnaround plan, 2008 has been a challenging year for eBay. So much so that analysts expect the company’s earnings per share to drop 11 percent for the quarter.
The deepening recession is playing havoc with EBay’s now nine-month old turnaround strategy. While the company beat Wall Street’s lowered expectations for its third quarter Wednesday, it also updated it’s guidance to better reflect “current business trends.” And “current business trends” being what they are, that guidance falls somewhere between lousy and repellent.
eBay President and CEO Meg Whitman is indeed retiring, and John Donahoe, president of eBay’s auction business unit, will succeed her.
Previously: eBay CEO High Bidder in Auction for Romney Presidential Cabinet Spot?
John Paczkowski has been poking fun at the tech industry and the personalities that drive it since 1997. From 1999 to 2007, he wrote the award-winning tech news Web log Good Morning Silicon Valley for the San Jose Mercury News, Silicon Valley's daily newspaper. Read more »
Here is a statement of my ethics and coverage policies. It is more than most of you want to know, but, in the age of suspicion of the media, I am laying it all out.
Best use of the Beeker “meee” ever.
While the technology behind the Telephone is new, the design is reassuringly old-fashioned, reminiscent of a phrenologist’s horn or ear-candle in form. We found the experience far more comfortable than the one we had with the Telegraph.
12:58 AM: Breakfast: Two schools of fish from Tokyo Bay. Calories: 782,000. How I was feeling when I ate this: confused, irradiated, hating my size.
11:37 AM: Exercise: “Taxi Stomp” (alternating legs, for 30 blocks). Calories burned: 148,900,183.
1983. The Beatles announce their first tour in thirteen years, but likewise announce that Michael Jackson will be going on tour with them as a one gigantic mega-concert event.
Best video mashup ever.
A Facebook Memorial
Wow.
Worth it for the Rickrolling photo alone.
Excellent.
Flughumor!
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