eBay Pledges Skype IPO

The buzz this week has been around eBay Inc. (Nasdaq: EBAY) possibly selling off Skype Ltd. -- but no! The offical plan is for Skype to go public next year.

eBay officials said so in a press release issued late yesterday, possibly in response to chatter about Skype founders Janus Friis and Niklas Zennstrom wanting to buy back the division. (See eBay plans Skype IPO.)

Rumors to that effect surfaced late last week, the theory being that the duo were putting up about $2 billion for Skype. The money would be a combination of private equity and a loan from eBay itself, so the theory goes.

That deal hasn't emerged, but a similar deal did: It was disclosed this week that eBay sold a different acquisition, StumbleUpon, back to its founders. (See Skype Goes on the Block.)

EBay bought Skype in 2005 hoping to find ways to meld the VoIP service with eBay's auctions. (See EBay Buys Skype for $2.6B.) Yesterday's press release bluntly admits that Skype hasn't been a fit there -- nor has it found much common ground with eBay's Paypal.

"Separating Skype will allow eBay to focus entirely on our two core growth engines – e-commerce and online payments," eBay CEO John Donahoe says in the press release.

Skype's revenues have climbed to $550.8 million in 2008, compared with less than $100 million in 2005. (See Skype's EBubble.) It's been profitable for eight quarters running and is on track for $1 billion in revenues in 2011, according to recent eBay claims. (See Skype Targets $1B Revenues.)

Skype is also making inroads into the mobile world. eBay's release singles out the iPhone, saying 1 million people downloaded Skype in the first 36 hours that it was available for the iPhone. The service has made its way onto the Android and BlackBerry platforms as well. (See Skype Lands on iPhone, Blackberries to Get Skype, Skype Goes Android, Skype Ist Verboten!, and US Carriers Still Lukewarm on Skype.)

— Craig Matsumoto, West Coast Editor, Light Reading