Skype's founders say they are happy to have shaken down eBay for $530m, despite missing out on the huge payday they would've scored if the service was a bigger success.
The cash is only a third of what Janus Friis and Niklas Zennstrom would have trousered in 2009 if Skype had hit profit targets. In a posting on this blog, Friis gets all misty-eyed and sanguine, and writes: "Earn-outs are inherently difficult creatures, but we are happy with the result of this one.
"Skype has been an incredible adventure and I am proud to have been part of it. Looking back at 2003, at two guys running around with a crazy idea of building a global phone company purely on the internet, moving from one rented apartment to another, still battling a major lawsuit from our Kazaa days, 2003 seems a long time ago.".
As well as paying off the founders, eBay is taking a $900m hit for overvaluing Skype. The total $1.43bn charge will go a long way to wiping out its quarterly revenues, which last time round (three months to 30 June) were $1.8bn. Of course, its huge reserve coffers will absorb the blow easily.
Friis and Zennstrom have both been relieved of executive duties by eBay, and will concentrate on IPTV venture Joost, which came out of an invite-only beta yesterday into version 1.0. After exciting many with the quality of its video, Joost doesn't seem to have signed up any shows worth watching during its months of development.
The writing was on the wall at Skype when eBay boss Meg Whitman delivered her verdict during financial season in January. She said: "The monetisation efforts we outlined at the time of the acquisition are not developing as quickly as we had hoped."
The miss doesn't seem to have sated eBay's appetite for inexplicable cash splashing, however. It recently splurged $75m on StumbleUpon, a niche social bookmarking site with 3.5 million users and negligible revenues.
eBay's investors don't seem too bothered by yesterday's admission of failure, and held its stock price steady in trading on Monday The $2.6bn Skype clanger had already been factored in by Wall Street, it seems. With a monopoly on online auctions in the west, and overall profit margins of more than 20 per cent, eBay can afford a few mistakes, but we'll bet it won't take another Skype-sized punt for a while. ®