Breaking News eBay Taking Skype Out Public in 2010
Skype is a winner and we here at The SiliconAngle have been very bullish on them. Their iPhone app speaks volumes. This again is total validation for the new management at Skype and Josh Silverman. Josh has masterfully led this rapid acceleration of one of the best performing five years old since ‘Sunshine Street’.
Facebook recently became the fastest company in history to reach the mass market mark of 150 million users in 5 years. Putting that in perspective take a look at how long it took the iPod, the Cellphone, the Television to reach that 150 million user milestone – 7, 14, 24 years respectively.
Additionally, look no farther than the recent success of the iPhone. In less than one year since Apple launched the Apple Application store for their iPhone and iPod, there have been over one (1) billion applications downloaded. Expect the same adoption for the Google’s gPhone apps.
Here is the release from Skype:
eBay Inc. (Nasdaq: EBAY) today announced that it plans to separate Skype from the company, beginning with an initial public offering that is intended to be completed in the first half of 2010. Specific timing of the IPO will be based on market conditions.
“Skype is a great stand-alone business with strong fundamentals and accelerating momentum,” said eBay Inc.’s President and CEO, John Donahoe. “But it’s clear that Skype has limited synergies with eBay and PayPal. We believe operating Skype as a stand-alone publicly traded company is the best path for maximizing its potential. This will give Skype the focus and resources required to continue its growth and effectively compete in online voice and video communications. In addition, separating Skype will allow eBay to focus entirely on our two core growth engines—e-commerce and online payments—and deliver long-term value to our stockholders.”
The decision to separate Skype is based on a timeline outlined by Donahoe when he became eBay’s CEO in April 2008. At the time, the company said it would spend a year evaluating Skype and its potential synergies within the eBay Inc. portfolio before making any decisions about Skype’s future. Donahoe also installed a new management team at Skype led by Josh Silverman, which has driven stronger momentum and improved performance. In 2008, Skype generated revenues of $551 million, up 44 percent from 2007, and segment margins of approximately 21 percent. Registered users reached 405 million by the end of 2008, up 47 percent from 2007, and user metrics improved significantly throughout the year. The company recently announced that it expects Skype to top $1 billion in revenue in 2011, nearly doubling 2008 revenues.
“Under the leadership of Josh Silverman and his management team, Skype has become a stronger business in the past year, and I expect it will be even stronger a year from now,” Donahoe said. “Skype has accelerating global user growth and strong fundamentals, diversified revenue streams and is competitively positioned in a large market. We expect Josh and his team to continue delivering results as we prepare Skype for an IPO.”
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