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What Now for Skype, StumbleUpon?

Skype Logo-2
With the retirement of Meg Whitman after a decade at the helm of eBay, her successor, John Donahue, is already talking about improving search on eBay and and developing a system to present the best deals to shoppers.

That’s fine and dandy but a far more interesting strategic question is what eBay plans to do with two other units: StumbleUpon and Skype. Neither can be considered to be core assets, and eBay hasn’t really done much of anything with either since acquiring them.

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From a strategic perspective, there’s no reason for eBay to keep StumbleUpon or Skype. StumbleUpon is a quasi-interesting Web site discovery service, while Skype is a solid, growing business with healthy profit margins. Yet, neither offers any synergies or competitive differentiation for eBay’s core auction business – and let’s not waste any more talk about Skype offering eBay click-to-talk features.

So what does/can eBay do?

Skype should be an easier sale, although eBay will take a financial bath given it will get nowhere near the $4.1-billion that it wildly overpaid to steal Skype away from Google. It’s hard to tell how much StumbleUpon is worth, although there should be no lack of buyers.

In the short-term, dumping both assets will be painful financially and embarrassing corporately but their sales will be a good move in the long-term by allowing eBay to to focus on the core business and, hopefully, use the sale proceeds to buy businesses that are a better strategic fit.

Update: Compete.com’s blog has good analytical post looking at eEbay’s traffic and revenue per unique user numbers.

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  • http://www.mappingtheweb.com Aidan Henry

    In theory, I think Skype was supposed to (somehow) integrate into the eBay platform so that buyers could speak with sellers. Don’t ask me how.

    StumbleUpon is more interesting. I really had no idea how it might integrate, but then a thought popped into my mind. Doesn’t SU based itself off some sort of recommendation engine that learns from your decisions and behaviours? Perhaps eBay is working on an algorithmic recommendation engine, somewhat akin to Amazon.

    Or… maybe I’m just plain nuts. In any case, I never really saw fit for either acquisition in the first place.

    Cheers,
    Aidan
    http://www.MappingTheWeb.com

  • http://broadcasting-brain.com Mark Dykeman

    I think Skype’s technology will become commoditized faster than StumbleUpon’s. I think StumbleUpon, particularly its underlying community and engine, could ultimately become more valuable that Skype. I think they should think twice before they dump StumbleUpon.

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  • http://www.abrahamharrison.com katie

    Personally I think Ebay should sell StumbleUpon for whatever it can because there is better sponsorship out for the company. ebay is a great starting out point that will prove SU has great potential. Skype on the other hand was a huge investment and has gained in popularity and products in the past couple of years. I think with eBay as a backer, it will continue to gain momentumun in the VoIP community. That in turn will get the public to trust and use other services as well like my client ooVoo, which is a similar VoIP service that offers 6 way face-to-face communication and video messaging. VoIP and web raters are here to stay!

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