On 2008-04-24, SMS <scharf.steven@geemail.com> wrote:
> Skype is doing very poorly. eBay is trying to unload it, but who would
> buy it? They've lowered the valuation from the $3.1 billion they paid
> for it, down to $1.4 billion.

I'm not sure about this last bit. Skype has been profitable, and
increasingly so (well, if you include the writedown that would be
"cash flow positive") since Ebay began reporting their results.
Outside of the VoIP sidelines run by the cable and traditional
phone companies, I know of no other competitive VoIP company
which has been generating cash rather than consuming it.

They just aren't a good match for Ebay, though, and they certainly
didn't become profitable by charging exceptionally low prices for
the paid-for bits. On the other hand they do stand out in an
industry where almost no one else has found a business model
which doesn't leak cash. If the latter isn't discovered eventually
Skype might end up being the last man standing.

Dennis Ferguson