Google may acquire eBay’s Skype, voice ads to follow?
By Matt Jansen
Speculation is flying about Google potentially acquiring Skype, which has struggled to turn a profit for its current parent company, eBay. Google almost certainly thinks it can change the situation by dropping fees and adding advertising to portions of the Skype service.
So far Google has done an excellent job of keeping content the main course with a side of advertising, but Skype represents different medium with a single dimension. In other words, it won’t make sense for Google to play ads in the background while you’re in a conference call.
To effectively advertise during a Skype call, Google would have to place advertising before the call begins to ensure a captive audience. And, with Skyp Pro available at $3/month right now the advertising time sink may not be welcoming by current users.
Alternatively, Google could insert advertising within the Skype interface or alongside some of its possible integrations like with GTalk and GrandCentral. The tricky part will be maintaining a balance between user expectations of an uncluttered calling experience and building a compelling advertising section for sponsors.
According to TechCrunch,
Skype, acquired in late 2005 for $3.1 billion, has been a financial albatross around Ebay’s neck. eBay removed Skype co-founder and CEO Niklas Zennstrom in October 2007, reportedly due to frustration at the financial performance of Skype. Ebay also negotiated down the huge earnout due to Skype stockholders and took a $936 million one-time loss around the transaction.
Skype also boasts 276 million registered users that “. . . have now talked with one another for more than 100 billion minutes (100,000,000,000) using free Skype-to-Skype voice and video calls since Skype launched in 2003.”
Lots of users, lots of usage, but the problem continues to be transforming the cash sink into a profitable business engine.
Related:
Stumble It!
Entry was posted
on Wednesday, April 2nd, 2008 at 7:34 pm
under 
Print This Post
Read more entries by Matt Jansen.
