Going Rate For Skype Apparently Now $3 Billion

from the oceanfront-property-in-arizona dept

Frequently off-the-wall tech commentator Robert Cringely's no stranger to new telecom business models, having offered up a fairly ridiculous one himself some time ago. In his latest piece, he claims Skype "almost sold last week" to News Corp. for $3 billion. Yes, that was a B. Odder still, he tries to justify the price. We laughed it off last week when one of Skype's VCs said he wouldn't consider buyout offers of less than $1 billion -- a staggering amount based on a company with revenues estimated to be $10 million at the very most, but Cringely feels that Skype's disruptive potential to incumbent telcos justifies an even higher price tag. While it's likely that Skype will be sold, its value isn't as a business or a service, but as a technology. Cringely himself highlights that it's unclear how software-only net services like Skype can make money, and it's even less clear at this point just how much Skype is making from its paid services. It wouldn't be all that surprising to see somebody pony up a ridiculous amount of money for Skype given the stratospheric levels of hype (which we're calling "skhype") around it, but $3 billion is definitely over the odds considering the tremendous amount of work that would need to be done to take Skype from a PC-based IM program with voice to a true landline replacement -- particularly for a company with no fixed broadband assets. Skype's business model is unproven, regardless of Cringely's application of typical telecom financial metrics, as is the idea of running a replacement telephone network without having any control over the physical network. Skype's attraction for a large cut of its users is free and easy voice communications -- trying to build a business on getting those people to spend money doesn't make a lot of sense when so many other free IM programs exist. Skype's future is as a technology on somebody else's network, not as a service.


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here
Get Techdirt’s Daily Email
Save me a cookie
  • Note: A CRLF will be replaced by a break tag (<br>), all other allowable HTML will remain intact
  • Allowed HTML Tags: <b> <i> <a> <em> <br> <strong> <blockquote> <hr> <tt>
Follow Techdirt
A word from our sponsors...
Essential Reading
Techdirt Reading List
Techdirt Insider Chat
A word from our sponsors...
Recent Stories
A word from our sponsors...

Close

Email This