eBay's Skype Fiasco: What Were They Thinking?

| About: eBay Inc. (EBAY)

It is astounding that eBay forked (NASDAQ:EBAY) over $3B for Skype and didn’t actually buy Skype’s underlying technology.

It is amazing that they didn’t realize this and outright criminal that they didn’t get a fully-paid, irrevocable, perpetual, non-exclusive (exclusive for the purposes of international calling) license.

Om Malik has all of the links you need:

- Skype Founders suggest they still own underlying technology to Skype

- Will Joltid turn eBay’s planned Skype IPO into a nightmare?

- Why eBay Should Accept Skype Founders’ Buyout Offer.

Now this will probably get settled one way or another, and as a non-Skype user, non-eBay shareholder, I don’t really care either way.

But a few points:

- This proves that just because you hire expensive lawyers doesn’t mean anything.

- One more example of upward failing. To think this woman, Meg Whitman, could have been our Treasury secretary. I am sorry, however wonderful Ms. Whitman was, this was done on her watch and it’s just appalling in terms of botched due diligence.

- With all due respect to Skype founders Niklas Zennstrom and Janus Friis, you have to wonder, will anyone ever buy a company from them again? I mean, sure Viacom (NYSE:VIA) /CBS (NYSE:CBS) and a number of VCs invested in their next venture Joost (hmm… is there such a thing as karma?), but this was before this bit of news was out. Ultimately, I am not sure I would have a lot of comfort and confidence doing a deal with these guys.