Ebay's Skype seeks revenue from mobile, corporate business

Ebays Skype seeks reven

By SHARON WROBEL
EBay's cheap Internet-calling business Skype is focusing on expanding its mobile business and developing corporate software in an effort to find additional revenue routes. "We are growing faster in terms of usage and profit. Last quarter we generated $153 million in revenue, which was our 10th consecutive quarter of profitability," said Josh Silverman, CEO of Skype in an interview with journalists on the sidelines of President Shimon Peres's Facing Tomorrow Conference in Jerusalem on Wednesday. Looking ahead to where Skype is going, Silverman said that the company was focusing on advancing three goals: making multimodal communication even easier, penetrating the mobile phone world, and making a big push into the enterprise business. "In recent years there is a shift in technology from hardware to software applications," said Silverman. "We see a world of multimodal communication. We see an explosion of ways of communication which started with voice calls, to instant messaging, swift messaging services, and now to voice calls. In this new world, we see an explosive growth in video calls. A third of all of our calls are video conferencing." Last month EBay agreed to sell 65 percent of Skype to a group of investors in Silicon Valley and Europe for about $1.9 billion. The closure of the deal is still pending. Silverman said that currently Skype has 480 million registered users with an average of 300,000 users joining every day. "After six years of our launch Skype calls make up 8 percent of all international calling minutes with 500 billion calling minutes. We are seeing a 60% growth year-on-year," said Silverman. "Moreover 10% of all iPhones and i-Touch devices have Skype software." At the beginning of the month AT & T announced that it will allow Apple to enable voice over IP applications and Internet calling applications such as Skype to run on its 3G wireless data network. Previously, such applications were only allowed to operate via Wi-Fi. "It is the applications that drives demand," said Silverman. "Consumers don't wake up and say I want 3G but they want applications like Facebook or Skype." One of the main directions Skype is pushing at the moment according to Silverman is developing an enterprise software product which is built around greater productivity and not only cost savings. At present, Skype's only utility is that it's a cheap calling service that can leverage millions of subscribers and its ability to buy long distance minutes on the cheap. "Companies, NGOs and other institutions are already using Skype often enabling them to run a multi-office structure at low cost. Even large companies have very commonly Skype installed on their PCs," said Silverman. Silverman also commented on the current battle of net neutrality, which is the idea that carriers must give equal treatment to all uses of the Internet and not prohibit or block access to certain Web sites. "Data is data. Carriers should not make the decision which software to block," said Silverman. "It should be up to consumers to make the decision. Net neutrality is a fundamental issue of consumer protection and a matter of civil rights."