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Zennstrom Out As eBay Writes Down Skype |
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Written by Adam Gosling
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Tuesday, 02 October 2007 |
In an embarrassing admission for the online auction house that acquired an expensive VoIP start-up two years ago, Skype co-founder Niklas Zennstrom has been stood aside from the day-to-day running of eBay subsidiary, Skype and the company has had more than US$900 million written off its book worth.
{mosloadposition inline}Meg Whitman's removal might have been more appropriate that
Zennstrom's. It was after all on Whitman's watch that eBay paid a
patently ridiculous price for a company that provided free phone calls.
While it's not quite the final saga in this sad tale of bubble-driven
madness eBay's Chief Strategy Officer, Michael van
Swaaij, will take over the reins while a new CEO can be found, while
Zennstrom, who helped start Skype after his partner Janus
Friis and he escaped a whole mess of trouble brewing at their last start-up a P2P file sharing (music stealing) system called KaZaA.
KaZaA was 'sold' to a company called Sharman Networks located in the Republic of Vanuatu and ultimately lost a long drawn-out legal battle in the Australian courts against the music companies who alleged it failed to stop pirated music being exchanged on its P2P network.
Perhaps Zennstrom & Friss' pirating credentials could have
served as a warning to Whitman, who laid down US$2.6 billion of her
shareholders money to gain control of what was and continues to be the
world's most successful free phone company.
Not only did the Skype sale make the paid mega-rich, the earn out
potential was enormous with a further US$1.7 billion promised if Skype
could hit specific targets in 2008-2009. That ain't gonna happen, but
to clear the books, Whitman has negotiated an early exit to that deal
paying "certain shareholders" a further US$530 million taking this weeks charges to the balance sheet up over the US$1.4 billion mark.
Alarmingly, Zennstrom is not completely out at eBay and will still no doubt draw a salary as non-executive chairman of the Skype Board of Directors, while Henry Gomez another hang over from the Skype acquisition will take on a role at eBay as Senior
VP for Corporate Affairs.
Skype contributed less than US90 million to eBay's Second Quarter
revenue. That was double its contribution from a year ago, but
represents only about 20 per cent of eBay's revenues for the Quarter.
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