Skype disappoints eBay Thursday, January 25, 2007
Despite rapidly growing user numbers (171m users, up 129% in 12months), eBay acknowledged "revenue has not developed as quickly as they'd hoped" in its earnings statement ($66m in Q406, up 31% on Q306).
Is this news surprising? I spend lots of time using skype for calls, video calls and IM. Yet I've never paid a cent in 3+ yrs of use.
Whilst skype anticipates only a small proportion of its users will generate revenues, it faces an unusual scenario with its current pricing structure; the more people that join skype, the less I and other skype users need to consider skype in/out paid for services. And when I do need to connect with none-skype users, I can usually find a number of online voip operators that have a promotion with free calls to my destination e.g. voipcheap.com
Would I pay a subscription for skype? Given the network benefits of lots of people being on it, I would - say £10 per quarter. But if subs came in, would there be a mass exodus, thereby destroying the hoped for revenues and creating a viscious circle in which other left because their contacts were no longer using it? I believe so.
Other brands are piling into this space, so I can't see life getting any better for skype. That said, with such a large customer base and recent prices paid for "customers" of nearly $10, it still implies a current value of over $1.5bn. Note, the 171m number reported relates to accounts in existence and not active accounts - in my experience skype never reports over 9m online at any one time.
posted by John Wilson @ 3:16 PM Permanent Link
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