Skype, eBay Divorce: What Went Wrong

01.09.2009
The future looked bright in September 2005 when announced it was for $2.6 billion. But after four years of unfulfilled expectations, the marriage between the online auction giant and the upstart VoIP provider came to an end Tuesday when to a group of private investors for $1.9 billion.

Why did the merger fail? When eBay bought Skype, it had hoped the VoIP service would improve communications between its customers. Buyers could talk easily with sellers about items they were interested in; in turn, sellers could build relationships with customers via the power of VoIP chats.

But the Skype-eBay integration never panned out. The main reason: For most eBay users, email is good enough. Buyers and sellers don't really need a voice call to seal a deal.

"I'm a fairly regular eBay user, and there are ways of interacting without using voice over IP," says blogger and tech journalist Tom Keating, who writes the for TMCNet. "I think people like the anonymity of eBay. Talking is a great thing. You can communicate and ask more details about the product. But people prefer anonymity, and they don't necessarily want to talk with the person on the other end."

Andy Abramson, a marketing consultant and Internet telephony guru who writes the blog, agrees. The eBay ecosystem, he says, consists of three groups: buyers, sellers, and third-party operators that ship products. "Those three [groups] were built around a bunch of customers who never wanted to talk to anybody," Abramson says. With eBay, "you don't have to talk to your customers. You have to email them. Skype is all about talking or chatting."