eBay Shakes Up Management at $3.1B Blunder Skype, Takes $1.43 Billion Charge

[mandy]

eBay shook up the top management of its Skype peer-to-peer communications unit Monday, removing its cofounder as CEO and saying it will take a US$1.43 billion charge in the coming quarter to cover the cost of incentives in the original acquisition deal and to reflect lower overall value for the unit.

Niklas Zennstrom, Skype's cofounder, will give up his CEO seat and become non-executive chairman of the company's board. Skype's chief strategy officer, Michael van Swaaij, will serve as acting CEO while the company searches for a full-time replacement. In addition, Skype President Henry Gomez will return to the parent company as a senior vice president for corporate affairs reporting directly to eBay CEO Meg Whitman.

eBay has hired executive search firm Russell Reynolds Associates to help it find a new CEO for the unit, which it paid $2.6 billion for in September 2005...

full article: http://ecommercetimes.com/story/bQ8InWym...arge.xhtml

[FiberGuy]

This is rich!

[sneakymagenta]

"The firms that pave the way for new technology aren't always the ones who are around to reap the benefits," telecom analyst Jeff Kagan told the E-Commerce Times. "Over time, the big winners in the Web-based calling market may well be the companies that it was once believed were threatened by the rise of this technology rather than the startups like Skype and Vonage that brought it to market in the first place."

$2.6 billion down the drain. 

[DecorativeDishes]

$2.6 billion down the drain.

It boggles the mind. That's a lot of $.25 insertion fees... Kim

P.S. Haven't been by in awhile. Visited NYC for the first time this summer. Wonderful!!!

[amy]

Niklas Zennstrom, Skype's cofounder, will give up his CEO seat

Did eBay finally notice that he's been spending all of his time this year running his new startup Joost?

Visited NYC for the first time this summer. Wonderful!!!

Your visit must not have been during a heatwave. ;D

[regic]

InternetNews has a good article.

eBay's Durzy denies Zennstrom was forced to resign:

"It appears he wants to spend more time on Joost and Atomico. He's leaving the day-to-day operations for someone else to shepherd Skype's next phase of growth. I want to be very clear. He could have remained."

article: http://www.internetnews.com/bus-news/art...hp/3702751

[mandy]

The Economist weighs in:

Ms Whitman should have known better, because Skype became and continues to be a revolutionary technology precisely because it does not extract much revenue from its customers. “We want to make as little money as possible per user,” Niklas Zennstrom, Skype's co-founder, has said. Skype's breakthrough, in his view, was to point the way towards a time when all voice communication would cost the consumer nothing at all...

The rest of Silicon Valley has greeted Ms Whitman's misfortunes with Schadenfreude. But the gloating may be short-lived. By buying Skype, the internet phenomenon of 2005, eBay started a bubble. Google, with its purchase of YouTube, the cyber-star of 2006, inflated it further. And Microsoft and Google now appear tempted to add more froth by investing a silly sum in Facebook, the latest big thing. All three—the internet telephone firm, the video site and the social network—make almost no money. EBay's disappointment with Skype is a timely reminder of where this fad might lead...

Ms Whitman also mentioned a fourth lesson during her talk at Stanford. Her main job as boss, she said, is to put “the right person in the right job at the right time”. She emphasised the word “time”, since a manager who was right a few years ago may no longer be today. It is a lesson her own bosses, on eBay's board, will doutbless soon be reviewing.

full article: http://www.economist.com/research/articl...tid=348963&story_id=9904716