‘The Hype of Skype’

According to Nadahl Shocair, CEO, DeTeWe UK, eBay has lost its head by paying $2.6bn for a chat program veiled as a telco adding that the VoIP market could go way of dot.com bubble with over inflated valuations.

“eBay has ‘lost its marbles’ by acquiring internet voice service Skype for $2.6bn.” Commented Shocair who has warned previously that services such as Skype, which do not enable consumers to use traditional handsets are doomed to remain the fascination and preserve of the technology community and ‘curious users’ who had downloaded the software, rather than bringing VoIP into the mainstream.

“For eBay to bid $2.6bn for Skype is just insane – eBay could have used any chat program to deliver exactly the same service to customers. Sure, there may be some incremental value to current eBay customers, but eBay is not going to become the next big VoIP player. To be really successful in VoIP terms, you need to be about more than just the technology or “disrupting” the old phone system. To really make commercial inroads, it’s got to be just as simple to use as the existing options – or hopefully, simpler. In addition, the service has got to be priced right so as to ensure that consumers feel compelled to make the switch.”
“I think you’d also have to ask the question as to whether this deal really represents good value for eBay shareholders. To those of us who’ve been in the telecoms market for 20 or 30 years, this smacks of the dot.com days, and the vastly over-inflated valuations for acquisition targets that were a feature of those times.”

“Successful widespread adoption of VoIP is going to happen when someone enters the market with a ‘plug and play’ solution, using the existing lines and handsets that Joe Public already has in their house. Until that time, this technology will continue to be more about the hype than a practical way of leveraging the Net to make calls.”

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