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Microsoft Pays Much Too Much for Skype
Posted By Minda Zetlin On May 11, 2011 @ 4:21 pm In E-Commerce,Office Software,Video | 2 Comments
“You’ve got to be kidding me.”
This response, from Microsoft shareholder and trust fund manager Hank Smith, quoted in the Vancouver Sun , pretty much sums up the general response to the $8.5 billion Microsoft paid to acquire Skype. Indeed, no matter how you look at it, the price seems kinda high.
o The next-highest bid , from Google, came in at only $4 billion
o Skype has lost money four of the last five years
o $8.5 billion is 39 percent higher than Skype’s own estimate of itself in its April regulatory filing
o It’s the highest price paid for an acquisition since 2000, the height of the dot-com boom
On the other hand, Microsoft does have plenty of cash, and a very big need to compete better with Google. So maybe this will wind up looking like a smart move in the long run.
Meanwhile, loyal Skype users are fretting that Microsoft will ruin the service…and some may be considering Google Talk as an alternative.
Article printed from Inc. Technology: http://technology.inc.com
URL to article: http://technology.inc.com/2011/05/11/microsoft-pays-much-too-much-for-skype/
URLs in this post:
 Vancouver Sun: http://www.vancouversun.com/business/Microsoft+Skype+more+than+calling+service+self+estimate/4764535/story.html
 next-highest bid: http://eu.techcrunch.com/2011/05/10/did-microsoft-overpay-for-skype-hell-yes-%E2%80%94-by-4-5-billion/
 fretting : http://www.pcmag.com/article2/0,2817,2385121,00.asp?kc=PCRSS03079TX1K0000585
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