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.
Hide this

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here

Subscribe to the Techdirt Daily newsletter

Comment Options:

  • Use markdown. Use plain text.
  • Make this the First Word or Last Word. No thanks. (get credits or sign in to see balance)    
  • Remember name/email/url (set a cookie)

Follow Techdirt
Special Affiliate Offer

Essential Reading
Techdirt Deals
Report this ad  |  Hide Techdirt ads
Techdirt Insider Chat
Recent Stories

This site, like most other sites on the web, uses cookies. For more information, see our privacy policy. Got it

Email This

This feature is only available to registered users. Register or sign in to use it.