Skype
by Robin Wauters on November 19, 2009

eBay has just announced that it has completed the sale of Skype, valuing the company at $2.75 billion. The investor consortium who is the buying party and will control an approximately 70 percent stake is a group led by Silver Lake Partners and includes Joltid (i.e. the company founded by Skype’s original founders) and “certain affiliated parties”, the Canada Pension Plan Investment Board and VC firm Andreessen Horowitz.

As previously announced, eBay received approximately $1.9 billion in cash and a note from the buyer in the principal amount of $125 million. The company also retained an approximately 30 percent equity investment in Skype. The company also purchased senior debt securities with a face value of $50 million as part of a Skype debt financing.

by Michael Arrington on November 12, 2009

Earlier this week we broke the story about Google’s acquisition of Gizmo5. Today Google announced the deal on the Google Voice blog.

They aren’t saying much other than that the Gizmo5 team will join the Google Voice team, and that new Gizmo5 signups will be disabled.

One thing this gives Google – a much needed soft phone on the desktop for users to make calls through Google Voice. And integration with Google Talk is likely as well, which will let users of that service access the normal telephone system for inbound and outbound calls.

All in all this pits Google Voice nicely against Skype, which was also looking to buy the company. From the blog post:

by Michael Arrington on November 9, 2009

Last month Skype was in talks to acquire VoIP startup Gizmo5. It was a perfect backup plan in case all that IP litigation didn’t work out. – Gizmo5’s SIP infrastructure could theoretically replace Skype’s proprietary P2P back end.

After the Skype settlement, though, Gizmo5’s strategic value to Skype sort of plummeted. In the meantime, Google bought them, say multiple sources with knowledge of the deal, for around $30 million in cash. The deal is done, say our sources, and will be announced shortly.

Gizmo5 is a good fit with a number of Google products. Google Talk allows voice calls between users but has no PSTN link to allow incoming or outbound calls to real phones. Gizmo5 does this well already.

And Google Voice is a great VoIP and phone identity service, but they have no endpoint for calls. Gizmo5, which by the way already integrates with Google Voice, is a soft phone end point for Google phone users. In other words, you will be able to make and receive calls to your Google Voice phone number from your computer.

This looks to me like Gizmo5 will be the glue that puts Google Voice and Google Talk together into a single product. And that product looks a lot like a Skype competitor.

by Erick Schonfeld on November 6, 2009

Earlier this morning, Niklas Zennström and Janus Friis settled their lawsuits with eBay and a syndicate of investors in return for a 14 percent stake in the company they founded. The lawsuits were complicating the spin-off of Skype from eBay because the Skype founders still controlled the service’s underlying peer-to-peer technology.

In an interview with me this morning, Marc Andreessen, one of the investors through his new fund Andreessen Horowitz, told me, “The deal was never held up. The money was in escrow and was going to close” even if the lawsuits weren’t settled. The transaction is on track to close later this quarter, and Josh Silvertman will continue to be CEO.

by Robin Wauters on November 6, 2009

eBay has just announced that it has reached a settlement with the founders of Skype, clearing the way for the sale of the Internet communication company to a consortium formed by private equity firm Silver Lake Partners, Andreessen Horowitz and the Canada Pension Plan Investment Board.

Index Ventures, a historical investor in Skype, is not going to be part of that buying party after all, and its partner Mike Volpi is definitely out of the picture (no surprises there). Marc Andreessen, partner of Andreessen Horowitz, tells us: “Everything is settled—all lawsuits, all IP. The Joltid IP is now owned by Skype. The company is free and clear to execute to its full potential.”

The original Skype founders, Niklas Zennström and Janus Friis, are now back in the game. The Scandinavian businessmen are getting 14 percent of Skype back for rights to the Global Index P2P technology their company Joltid controls (which is key to the Skype software) – and not 10% like previously reported by other media. In addition, Friis and Zennström gain representation on the board of the new entity. The two men are also putting in a ’significant amount of capital’ of their own in exchange for the stake in the new company, presumably through their Atomico Ventures fund.

by Michael Arrington on November 3, 2009

In our October 8 post on the state of the Skype sale and litigation, we ended with a prediction: “The likely outcome of all of this remains the same – Joltid will get a stake of some size in Skype. But given the players involved, anything could still happen.” If GigaOm and the NYTimes are right, that’s exactly what’s happening. Even the “anything could still happen” part.

The old Skype founders will now have a stake in Skype according to unnamed sources. That makes sense. It was what eBay was negotiating with Skype long before the current buyout offer, and the team has to get something in exchange for dropping the intellectual property litigation.

But Index Ventures, the architect of the deal, is apparently out. For Silverlake Partners and Andreeseen Horowitz to agree to that either means there’s too much money involved for anyone to be worried about business loyalties, or there’s enough of a smoking gun that Index had no choice but to get away from the deal and all that liability.

Whatever the truth, everyone is in for a wild ride. Nobody who does business with the Skype founders ever seems to come out of it happy. Maybe Marc Andreessen has the patience to change all that this time around.

Just one problem, though. No one has ever described Marc Andreessen as a patient man.

by Leena Rao on October 29, 2009

Skype app developer Netralia is bringing high-quality video recording through it’s app, VodBurner. VodBurner lets users create video podcasts directly from Skype calls using webcams, incorporating recording and post-production editing in a single software package.

The app, which is $9.95 per month per computer, is fairly simple. Once downloaded, it will let you record a video and audio conversation via Skype and will then let you edit the final file within its software. What’s interesting about the app is that it actually detects who is talking (using volume) and will record the video of that person during the time. If both people are talking, the app will record video on both individuals in the frame. You can also add graphics and sub-titles to the videos and publish the clips as ASF files suitable for uploading directly to YouTube and other video-hosting services.

by Robin Wauters on October 27, 2009

Tomorrow at the eComm Europe 2009 event, Brussels-based provider of international VoIP origination services and telephone numbers Voxbone will be officially announcing that its global phone number service iNum now supports high-definition voice calling between Skype (which now boasts over 521 million users worldwide) and dozens of VoIP networks.

Voxbone will be transcoding between Skype’s wideband SILK codec and the HD codec G.722, with support for additional codes planned for the future.

by Erick Schonfeld on October 21, 2009

Even though it is embroiled in a nasty legal battle with its founders over its future, Skype continues to rack up impressive numbers. In today’s third quarter earnings from eBay (which still owns Skype, but is preparing to unload it), the company breaks out Skype’s performance (see slide above).

Skype’s registered users grew 41 percent to 521 million people. That’s a stunning 40 million new registered users in the past three months. Revenues grew 29 percent to $185 million. Free Skype-to-Skype minutes grew 74 percent to 27.7 billion minutes, whereas SkypeOut minutes (which is what members pay for) grew 44 percent to 3.1 billion minutes. All of those SkypeOut calls translated to a healthy $185 million in revenues, up 29 percent from a year ago.

by Robin Wauters on October 16, 2009

Tinychat, which started out as a simple IRC-style chatroom app to complement the quick-and-dirty conversations on platforms like Twitter, has been steadily building a solid browser-based communication platform that rivals some of the tools built by large corporations or venture-backed startups out there.

After adding essential features like video chat and screensharing options to the application back in May, Tinychat has recently leveraged P2P technology to enhance the service (see p2p.tinychat.com) and added embed capabilities that basically enable anyone with a website to integrate a robust, 100% peer-to-peer enabled video chat system by simply embedding some code and fiddling with some of the variables. (Skype, you listening?)

by Robin Wauters on October 15, 2009

Yesterday, the already very public fight for Skype entered yet another round, with the publication of recent filings of a motion for preliminary injunction against former Joost CEO and Chairman Mike Volpi and Index Ventures – where the man currently works as a partner – asking that he refrain from using knowledge or confidential information he obtained while at Joost in current dealings with eBay/Skype.

There are loads of interesting nuggets in the documents, which are well worth a read if you’re as fascinated by the whole thing as we are. For instance, would you have guessed both Facebook and multiple members of the Apache Software Foundation played an interesting role in this particular part of the story?

by Robin Wauters on October 14, 2009

Niklas Zennström and Janus Friis, the two European entrepreneurs and angel investors who famously co-founded companies like Kazaa, Skype, Joost and JoltId, have played an instrumental role in setting up and funding a new music startup called Rdio, the NYTimes reported earlier this morning.

Little is known about the ’secretive’ startup, and its website reveals nothing but the logo at this point. NYT reporter Brad Stone writes that the upstart boasts offices in both Los Angeles and San Francisco and that it’s going to offer a paid subscription-based music consumption and purchasing platform for both PCs and mobile phones, starting early next year.

by Michael Arrington on October 13, 2009

Litigation-beleaguered Skype is in negotiations to buy peer-to-peer VoIP startup Gizmo5, say multiple sources. The price tag is said to be in the $50 million range, but the deal is far from consummated. Other potential buyers may be looking at the company as well. Gizmo5, which was founded in April 2003, has raised $6 million to date, plus an unspecified amount from founder/CEO Michael Robertson.

Skype, which is being sold from eBay to a new investor group, doesn’t have control over it’s core P2P technology, and that intellectual property is now the subject of two lawsuits – one against Skype and one against Mike Volpi and Index Ventures, who are part of the buyout group.

That puts Skype at significant risk. Without the technology Skype can’t make Skype to Skype calls, the core of its service. And those lawsuits don’t appear to be close to settlement – some people close to Skype saw that there is a good chance the cases will actually end up being tried in a court.

We’ve heard Joltid wants as much as half of Skype Unless Skype makes huge concessions to plaintiff Joltid and settle the case, they have two backup plans.

by Jason Kincaid on October 12, 2009

The United Nations has collaborated with Skype, Facebook, and Ustream to give users worldwide a greater degree of exposure and access to celebrities and politicians taking part in the Stand Up Take Action! movement to end poverty. This week key figures including former Irish President Mary Robinson and African entertainers Femi Kuti, Angelique Kidjo and Yvonne Chakachaka, will be taking part in Skype video chats that Ustream will be broadcasting through the Millenium Campaign’s Facebook Page and Ustream channel. The calls will also include Facebook’s Live Stream widget.

by Michael Arrington on October 8, 2009

Don’t be fooled. Even though there hasn’t been any news on the various lawsuits around Skype’s intellectual property ownership, that doesn’t mean things aren’t happening behind the scenes.

Negotiations continue, say multiple sources, between eBay, the new proposed Skype owner group, and the original founders Janus Friis and Niklas Zennstrom, via their company Joltd, in what is turning into a very high stakes and very emotional game of poker.

Joltid first sued eBay/Skype in July 2009, claiming breach of a license agreement that granted Skype the use of key technology.

Multiple sources have confirmed to us that settlement negotiations were underway with Joltid to give the company a percentage of Skype to drop the litigation. Joltid was to receive “between 5% and 15% of Skype” to settle.

by Robin Wauters on October 8, 2009

The U.S. Court of Appeals for the Federal Circuit last Tuesday affirmed a lower court’s decision to dismiss patent claims against Skype and its parent company (for now) eBay relating to uniform network technology. The federal appeals court affirmed without comment the dismissal of claims brought by Peer Communications, a subsidiary of Acacia Research Corporation, reports Law360.

Acacia Research’s subisidiaries are in the business (PDF) of acquiring, developing, licensing and enforcing patents, according to its website.

by Erick Schonfeld on October 5, 2009

Over the past few months, Skype has been testing click-to-call ads on the Web, partnering with local-business directories who pay for the calls. Tomorrow, Skype is set to announce the official roll-out of its click-to-call advertising service with European Directories, one of the largest local business directory services in Europe.

Part of Skype’s latest version for Windows (Skype 4.1) comes with a browser plug-in that lights up phone numbers on Web pages. Users can click on the numbers to automatically launch a Skype call, but they pay for the SkypeOut minutes. Skype is taking the same functionality and making those calls free to consumers by partnering with directory listing services who pay for them instead.

by Robin Wauters on September 23, 2009

GigaOm last night already predicted an announcement was forthcoming, but now it’s official: Skype has announced that the beta version of Skype for SIP has been certified as interoperable with Cisco’s Unified Communications 500 Series for Small Business.

This will enable SMBs who manage their networking and communications needs with the Cisco solution to communicate more efficiently by directing their outbound calls to mobiles and landlines over Skype’s VoIP service.

The integrated solution will also allow employees to receive inbound calls from Skype users (now over 480 million strong according to the release). Earlier this year, similar arrangements were struck by the eBay company with Shoretel and SIPfoundry’s sipXecs platform.

by Michael Arrington on September 18, 2009

When a group of investors pooled their resources a few weeks ago to put a bid in to buy Skype from eBay, I thought there was a good chance that Skype’s legal woes were behind them. Apparently, I was wrong, and a new lawsuit makes it clear just how bad the situation is for Skype.

Sure, Skype doesn’t own its core P2P technology, and founders Janus Friis and Niklas Zennstrom were trying to rip that IP out of the service. But that’s all old news from months ago. Surely those new investors wouldn’t have committed to paying $1.9 billion for 65% of a company that didn’t control its IP?

At the time of the deal, people close to the transaction told me that the new investors had a much better relationship with Niklas and Janus than eBay, and the situation would soon be worked out. Our best guess was the two would be given a piece of Skype, and possibly a board seat, and the litigation would be dropped.

by Leena Rao on September 18, 2009

The Skype-eBay plot thickens. Joost and Joltid, both companies owned by Skype’s founders, have filed a lawsuit against former Joost chairman and CEO, Mike Volpi. The suit also names Index Ventures, the VC firm where Volpi is a partner. In a nutshell, the legal documents say that Volpi obtained confidential information in his role as CEO of Joost about how to circumvent Joltid’s IP. We’ve embedded the legal document that appears to have been filed this morning, below.

Earlier this week, Joltid, the Swedish firm owned by founders of Skype sued eBay and recent Skype buyer Silver Lake Partners and its partners in the buyout, Index Ventures, Andreessen Horowitz and the Canada Pension Plan Investment Board; accusing them of copyright violations. The twist: Skype founders Janus Friis and Niklas Zennstrom also founded Joost and Volpi, Joost’s former chairman and CEO who left the imploding company in June to become a partner at Index Ventures, has been rumored to be a contender for Skype’s CEO positio

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