Ebay Plans To Rid Itself of Skype

Ebay, Inc. has been in the news a lot lately, most recently for its sale of StumbleUpon (SU) — the online recommendation site — back to its original owners for an undisclosed sum. Ebay acquired SU in 2007, a move that was widely panned by SU devotees. Now, Ebay is looking to unload another acquisition, this time its internet-calling unit, Skype. By 2010 Ebay plans to hold an IPO or Initial Public Offering, which will separate Skype from its parent.

The Many Brands of Ebay

Ebay, Inc., which is best known for its online auction site bearing the same name, has ventured well beyond its base since being founded in 1995. Like Amazon, Google, Microsoft, Yahoo and other big internet names, Ebay has acquired quite a few companies over the years including Half.com, Paypal, a portion of Craiglist, StubHub, Shopping.com and others. Some of the acquisitions have been a very good fit, such as Paypal, while others have been nothing but trouble. Skype falls into the latter category.

According to The Wall Street Journal (WSJ), Ebay is selling Skype in response to investor demands to rid itself of the unprofitable business. Ebay purchased Skype for $2.6 billion in cash in stock in 2005, but took a $1.4 billion write off in 2007 to reflect the unit’s diminished value. When John Donahue took over Ebay in 2008, he announced that Skype seemed to be a poor fit with the rest of the company’s business, signaling that its sale was forthcoming.

Goldman Sachs to Oversee IPO

Ebay has hired the prestigious Goldman Sachs Group to handle the public offering which is expected to be held in early 2010. Skye’s founders – Niklas Zennstrom and Janus Friis – have attempted to buy Skype back from Ebay, but their price was well below what Ebay wanted for the unit. When the IPO is held next year, Ebay says that it will remain a shareholder in the new company.

The WSJ says that waiting until next year to hold an IPO for Skype may work to Ebay’s advantage, especially given the current state of the economy where the IPO market has largely been dormant since last summer. But, the newspaper also says that investors may be leery about investing in Skype given the bad experience many had when Clearwire Corp. had their own IPO in 2007. Back then, Clearwire fetched $25 a share, but was later merged with a Sprint unit.  Clearwire investors were clearly burned in the transaction as their stock values dropped to about $20 per share when all was said and done.

As for Skype, the unit continues to bring in hundreds of millions of dollars annually in revenue, charging just 2.1 cents per minute for users to call landlines while offering free calls to other Skype users in most instances. Perhaps the most tantalizing aspect of Skype is that the service now claims more than 400 million users worldwide.

Related Reading:  Skype, the Britney Spears of Telecommunication?

Freebie Classified Sites Are Blossoming

I had occasion recently to do some research on the alternatives to Craigslist, the ubiquitous online classified site that everyone in the world seems to be using. At least everyone that I know who is looking for a job, seeking to promote their website or business, or desiring to SEO (spam) their way to success. Which is almost everyone! wink*wink

Let’s just say that one of my SEO practices warranted that I take a look at some Craigslist alternatives out there, thus the reasoning behind my research.

What I found was a pleasant surprise, not that I didn’t think that other sites existed, but that some of these have been around for quite awhile. I know a lot of people live or die with Craigslist (CL), but if you’re looking for something a bit different, then the following are worth a shot:

Backpage — This site has the look and feel of CL, but is a bit more polished than the standard bearer. Ads run for free and the city selection roughly parallels CL. You can pay a few a token amount of money to automatically bump ads every seven days and you can purchase block ads which dominate the top of listing category and cannot be flagged by users. Backpage is owned by the Village Voice.

ClassifiedExtra — Canadians in Toronto and Vancouver love Craigslist — I know this because if I have to post an advertisement in either location, both cities perform extremely well with CL. CE is new to me, but with a PR6 ranking, it gets a good amount of traffic with penetration throughout Canada. A French edition is also available.

Gumtree — For UK readers, I’m thinking that Gumtree could be your favorite site. Again, this is like CL but a bit more refined. Select cities in Ireland, Australia, New Zealand, South Africa, and the US are also featured. Gumtree is tied in with Kijiji (see below).

Kijiji — Don’t ask me how to pronounce this site! I just started using it yesterday, posting an ad very similar to what I can post on CL. I like the layout, the fact that ads stay live for six months (okay, maybe I’d prefer to bump them up), and a synopsis of the listing is featured on their site. Kijiji and Gumtree are eBay companies.

There are other classified sites out there including Recycler, serving Los Angeles and Southern California; LiveDeal — which is tied in with the YellowPages; and AdPost, to name just a few.

Oodle is interesting as it operates as an aggregator of several sites including CL, Kijiji, and several popular job sites.

If you’re looking for a gig, something to sell, or an item to buy, these other sites can provide some decent alternatives to CL and each one is free to use. SEO anyone?