Skype co-founder admits Ebay was fleeced

Niklas Zennstrom, the co-founder and ex-chief executive of Internet Phone Darling, Skype has publicly admitted that... well.... his former employee paid well over the odds to snatch the VoIP company.

Ebay paid USD 2.6 billion for Skype back in September 2005 and has only recently has to record a profit, prompting Ebay to cut as much as USD 1.43 billion from its valuation (an Asset Impairment Charge).

Skype is used by around 220 million users around the world but according to analyst firm Gartner, Ebay managed to generate only 80p per subscriber per year, amid a sector which has seen rising competition from the likes of Google, Microsoft, AOL and Yahoo who have rehauled their own Instant Messaging Clients to offer Voice over IP support.

Ebay has tried to integrate Skype in its overall internet strategy and has offered Skype communication options in Ebay and Gumtree.

All is not gloom and doom though for Skype; as companies try to cut communication costs and businesses embrace globalisation, Skype seems bound to rebounce; already 350,000 US Small and Medium Businesses have adopted Skype.