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Skype Growth May Be Slowing |
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Written by Adam Gosling
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Monday, 21 August 2006 |
Skype has amassed a gazillion downloads and registered
users, but the high-flying poster boy/girl of the consumer VoIP space may be
running out of steam.
According to a recent
report outlining an analysis by RBC Capital Markets analyst Jordan Rohan, the
company's growth may be hitting the ceiling with both downloads and sign-ups
starting to level off.
The analysis notes that both downloads and new users, are not
growing as they once were despite being on track to record 51 million downloads
this quarter.
The point is that Rohan believes this is slightly lower than
Skype's second quarter download result.
"Our recent checks indicate ... that the user growth is
no longer accelerating," Rohan reportedly wrote to his clients. "EBay
may need to spend on marketing or offer price promotions to reaccelerate growth
heading into 2007. If eBay chooses to do both, margins would fall short or our
revised forecast."
Further he says that the 18 million new users he believes
Skype will report for the fiscal third quarter (30 October, 2006) will be the
same as its second quarter result.
Every since eBay surprised the industry with the princely
sum of US$2.1 billion (plus potential earnout) for the Skype business, the
company has been hard pressed to justify the price and Rohan believes eBay's
business could be teetering as well.
Rohan also notes that eBay's Korean unit last week reported
operating margins dipped to 15% during the just-completed quarter, compared to
29% from a year ago. Revenue fell 1% as well.
For tis part eBay is not changing its 2006 revenue estimates
for Skype of US$200 million and says the Skype growth has remained consistent
during the first two quarters, without providing any advanced warning on how it
might be going for the third.
Looking further out, Rohan reduced his guess at Skype
revenues for the next fiscal year from US$475 million to $400 million and also
lowered his price target for eBay shares a dollar to US$31.
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