Will Ebay auction Skype?

EBay admitted that it paid far too much when it acquired Skype in 2005 for $2.5 billion. Today, analysts and investors are clamoring that Skype's lagging growth and growing competition may require a sell-off of the VoIP/IM/video company.

When first purchased, EBay expected Skype to fuel its online auction business by providing an ultra-cheap ways for buyers and sellers to connect directly online.  But the two companies have remained apart and failed to build a joint story

Skype continues to face increasing pressure to perform beyond even reasonable expectations, as EBay's growth slows and adoption of Skype for auction communications proves to be marginal. Granted, Skype has had six consecutive (but marginally) profitable quarters and plans new iterations of its trademark offering that has already won hundreds of millions of users. But that might not be enough for EBay to continue to hold on to the Luxembourg-based company.

Rumors abound that EBay seeks to spin Skype off to another suitor and Google is not surprisingly at the front of these M&A rumors.

Any potential sale also will be shadowed by rumors of the Skype backdoor, narrowing market cap and potential security issues with payment plans. 

For more:
- read the full report at businessweek.com. Article. 

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