Et tu, eBay?

Today, one of the biggest technology acquisitions was announced: Microsoft buys Skype for $8.5 billion. I have read conflicting analyses of the deal: some people applaud it as a way to improve Microsoft’s offerings in internet communications, while others say that Microsoft grossly overpaid.

I have just one question: how will Microsoft make a success out of Skype when eBay failed?

Yes: eBay previously bought Skype, then later sold it off at a loss. At the time eBay bought Skype, people said that eBay would get great value from synergies: buyers could chat instantly with sellers online and improve the online shopping experience. Except these so-called synergies didn’t materialize, and eBay sold Skype at a loss.

So what’s new now? Ah yes, more promises of ‘synergies’ with Microsoft’s Windows Messenger, Xbox, Windows Phone 7, Lync and a number of other technologies that few have heard of. Except, Microsoft already has chat, voice and video calling in these products today. In other words, Skype is redundant with a wide range of existing Microsoft technologies.

So what did Microsoft buy, exactly? A brand? $8.5 billion seems like a lot to pay for a brand that’s not exactly a household name.

And why will Microsoft make Skype profitable when eBay couldn’t? At least eBay didn’t have the technology; with Microsoft, it seems like they spent a fortune to buy technology they already had.

(I am aware that Skype had a patent issue that was resolved after eBay sold them. Again, if Skype was so valuable after the patent issue was resolved, eBay could have bought them back.)

Explore posts in the same categories: Business, Tech

One Comment on “Et tu, eBay?”

  1. Maria Says:

    Personally, I think Microsoft will ruin the company and the product. I can’t seem them making it better, and if it isn’t better, than how can it turn a profit? $8.5 billion. There are so many better things to do with that kind of money.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: