Network Computing is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

eBay Chief Sees Skype Synergies, PayPal Founder Doubtful

EBay chief executive Meg Whitman is struggling to align two ancient Greek concepts -- synergy and hubris -- as she develops synergistic plans combining eBay with its Skype VoIP unit and with its PayPal payments division. And she's trying to do all of it while attempting to make eBay's multibillion dollar acquisition of Skype pay off.

For starters, eBay plans to inaugurate a "click-to-call" Skype button on eBay beginning Monday. At eBay's annual user meeting in Las Vegas Tuesday, Whitman said Skype -- for which eBay paid as much as $4 billion last fall -- should be profitable in the fourth quarter this year.

"We want to build synergies," she said, according to press reports, "so that one plus one plus one equals a lot more than three." She noted that eBay is the world's leading auction provider, Skype accounts for the largest single piece of the world's long distance calling, and PayPal is considered the premier online payments solution.

Most attention at the Las Vegas meeting was focused on Skype, however, which has been generating less then $100 million in annual revenues. Most of that revenue comes from the VoIP provider's SkypeOut service, which connects Skype callers to users of public switched telephone networks around the world. Skype's stock has dropped more than 20 percent since the acquisition.

As outlined by Whitman, eBay's vision for Skype includes future revenue from online advertising, PayPal payments, data services, instant-messaging, and text messaging.

  • 1