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Skype and Vonage: Can You Hear The VoIP Bubble Bursting?

It's looking more and more as if the VoIP hype bubble is going the way of the Internet bubble. Skype, bought for up to $4.1 billion by eBay, is turning out to be a bad investment, and as for the Vonage IPO -- it's more than 40% under its IPO price of a few weeks ago, and heading south.
eBay has shown a variety of ways that Skype will integrate with auctions and with PayPal. You'll be able to make or request PayPal payments from Skype. You'll be able click links in auctions to talk to others via Skype. You'll be able to talk to eBay customer service reps via Skype.

All very nice. But not $4.1 billion nice. As I've said before, eBay got taken for a ride.

Vonage investors also got taken for a ride. The IPO went out at $17 a share. It's now under $10, and may well keep sliding. If there's any justice, it should keep sliding, because there's no future in this company.

eBay and Vonage investors got carried away with irrational exuberance over The Next Big Thing. VoIP is the future! VoIP will change the world! VoIP will make you rich!

In fact, VoIP is the future, and it will change the way we all communicate. It just won't make anyone rich fast. It's a great technology, and it certainly is the future of voice.

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