Skype, the Britney Spears of Telecommunication?
Although Skype has been around for a few years, my first known encounter with the internet telephony provider took place last Fall when the CEO of an online gift store contacted me about writing press releases for his company. He asked me almost immediately whether I was using Skype and made sure that I knew he was.
I wasn’t impressed by the quality of his calls as most of the conversations we had were not
very clear. At the time my phone service was with one of Ma Bell’s offspring, but I later switched to internet telephony as provided by our cable company. Skype, which offers a free service, doesn’t compare to the quality of the calls Time Warner Cable offers to me. Then again, I have never downloaded Skype for my personal use.
eBay acquired Skype for a hefty $2.6 billion in September 2005 from a pair of entrepreneurs, Niklas Zennstrom of Sweden and Janus Friis who hails from Denmark. Both men founded the peer-to-peer file sharing company KaZaA in 2000 which they sold a few years later in order to start Skype.
Footnote: Zennstrom and Friis are now on their third joint start up — the interactive software program Joost.
Now back to eBay. Two years after acquiring Skype, Zennstrom is gone and eBay has finally realized that the price that they paid for Skype was too high. Indeed, eBay says that they are writing down the value of Skype by $900 million to better reflect Skype’s actual worth. eBay is writing off an additional $530 million to pay off several Skype investors including Zennstrom who was Skype’s Chief Executive Officer under eBay.
The total of the “impairment charge” being taken by eBay is a whopping $1.43 billion.
What does this story have to do with Britney Spears? Not a whole lot other than this: the value of your commodity — whatever/whoever it is — could be grossly overpriced. When Skype/Spears’ performance drops, what are you left with? Answer: Big losses and a tarnished image.

interesting way to look at it. i haven’t tried skype but the many i’ve talked to said it was great. i do have to admit it is overhyped.
The Foo, just this past August Skype had a major outage which rendered their IM service unusable. I am not sure if it had the same effect on their phone service.
I heard about that one. I was looking into trying out the Skype business version but decided against it when that came about.
The Foo, looks like you doesn’t interested on skype huh. I just used skype to communicate with my sister who stayed far from me as it cost cheaper than fixed line.
I just signed up for Skype yesterday as it offers an easy (hardware-free) way to record phonecalls - I was interviewing someone for an article I am working on. I wasn’t thrilled by the call quality, I have to admit, so would be interested to hear about any comparable VOIP software. I’m much more interested in using it to call real landlines than to call Skype-to-Skype.
Hi John,
I can’t recommend anyone with absolute certainty, but I do know that Packet8, MediaRing, and Vonage have made a name for themselves.
Some providers allow you to call landlines, but (as in the case of MediaRing) currently do not allow you to receive landline calls, although in MediaRing’s case that is about to change.
here is a good site to compare VoIP — I found it doing research on providers:
http://www.consumercompare.org/voip/compare.php?kw=gbb1+broadband%20phones&gclid=CLeKkMqfq44CFSCTWAodxmNjZA
Vonage seems to be the best one out there but it too seems to be in trouble with major legal issues — hope it will survive it… it is value for money and reliable too. It’s currently having to pay out millions about $69 million to Sprint in addition to the $65 to Verizon.
Just remains to be seen whether it’ll pave the way for other smaller ones to emerge from being in the Vonage’s shadow all this time.
I have an account in Skype. I never tried using it by calling somebody yet…I just use it when chatting with friends.
Bambi, chatting seems to work well with Skype, but the Skype-to-Skype calls are an issue.
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Skype is the best Instant messaging software if you ask me. It covers all I need.
there is no more expensive long distance provider than Skype here in canada, .28 per minute? plus .07 connect, why would anyone use it.
i’ve using skype for 2 years almost every day. i can’t imagine my working day without it.