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September 12, 2005
eBay buys Skype to create "unparalleled e-commerce and communications engine"
Online auction site eBay is acquiring internet telephone company Skype Technologies for $2.6bn (£1.4bn), in order to create "an unparalleled e-commerce and communications engine".
Skype's software enables PC users to talk to each other, free of charge, and also make reduced-price calls to mobiles and landlines. It uses Voice over Internet Protocol technology that converts phone conversations into packets of data. These are then transmitted down the same wires used to surf the internet.
"Communications is at the heart of e-commerce and community," said eBay chief executive Meg Whitman.
"By combining the two leading e-commerce franchises, eBay and PayPal, with the leader in internet voice communications, we will create an extraordinarily powerful environment for business on the net."
Rivals in the online phone market include Google, Microsoft, AOL and Yahoo. Google has recently launched its Talk service and Microsoft acquired Teleo for an undisclosed sum.
The acquisition is expected to strengthen eBay's global marketplace and payments service and also open up new business opportunities.
Skype has 53 million registered users and approximately two million people use its software at any given moment. It was launched in 2003, since when the free program has been downloaded over 151 million times.
Posted by at September 12, 2005 07:32 PM
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