KWPro.net

ebay apparently is down from the Skype acquisition.  almost a billion dollars down.  the best part about the article is where it reads how they overvalued Skype.  but this is true with a lot of these acquisitions.  fortunately, most startups are in an  acquisition mode rather than aiming for IPO, which means that its these juggernauts who are being penalized.  but in some cases like ebay, the acquisitions make no sense especially at the price tag.

in the case of skype, there is no doubt of the future for such a service.  however, it made little sense for ebay, of many of the juggernauts, to make that purchase.  skype makes money...only a little less than $100 million per year(?).  but the intrinsic value of such a company pertains more towards a company like AT&T than ebay.

I don't think buying a company like skype is a bad idea.  I do think overpaying for it and not having a clear strategy to an investor is worse though.  and, as i mentioned, expanding for the sake of showing growth to investors is a terrible business strategy.  ebay is now obviously and literally paying for the acquisition while the previous CEO is laughing to the bank.

that said, i do hope other companies have the same chance that skype did so that new groups of people can make decent money from acquisitions.  i hope that these buyouts continue for a while (i'm certain they will), although these situations should send warning signals to these companies to be more careful of their purchases.  not to mention that they really need strategies to utilize these companies.