Updated: 4/30/2007; 4:05:58 PM.
Mark O'Neill's Radio Weblog

Tuesday, September 13, 2005

Skype & Ebay - wallets and the Irish angle

I've seen a lot of articles with titles like "Why Ebay bought Skype", but then I read them and the article basically says "who knows?".

Here are the only two insightful comments I've seen about the acquisition:

  • Donnacha on Slashdot :
    "Ebay's interest in Skype has nothing to do with augmenting their auctions with calls between buyers and sellers. This is about taking those (alleged) 50 million non-paying Skypers and giving them an easy, more attractive way of paying for individual calls rather then stumping up $5. Pretty much everyone has a Paypal account and this sort of tie-up would get them using both Paypal and Skype more, with people more willing to leave cash sitting in their Paypal accounts because "I might need it for calls". This would consolidate Paypal's dominant position, something Ebay are probably anxious to do in the wake of rumours of a Google e-payment service - most people will only really bother with one payment service and, if it covers their phone calls too, sticking with Paypal will be a no-brainer."
  • Antoin on Eire.com :
    "Buying Skype would bring eBay and Paypal onto the desktop. (Microsoft and Yahoo already have some presence on the desktop through instant messaging products, and Google is building presence through its popular toolbar, its new IM service and its presence on the Firefox browser.)"

This all makes sense to me. I have about 17 euro loaded into my Skype application that sits on my desktop. I don't actually use Paypal (or Ebay for that matter). But if I can pay for things easily using the money I've loaded into Skype, using the desktop app, then that turns Skype from being "only" a phone app into being a "wallet".

There is an Irish angle here too. It's not coincidental that both comments quote above come from Ireland (I'm assuming that the Donnacha who posted the Slashdot comment is based in Ireland - otherwise I can only imagine the mispronounciations of his name that he has to deal with). Ebay/Paypal has a large operation in Dublin (and seems to be hiring big-time: http://jobsearch.monster.ie/jobsearch.asp?co=xpaypaliex). Euroconex is another world-class payments operation based in Dublin. Google is there too, of course, and I agree that they must be thinking about payments too. That all says "critical mass" to me. Ireland's "light touch" regulation also suits the payments industry. Also, the currency of Skype is the same as the currency of Ireland (the Euro).

11:16:08 AM    comment []

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