02 October 2007

Caveat emptor. Word is that Microsoft (MSFT) may buy 5% of social
network Facebook for as much as $500 million. And, rumor is that Google
may outbid it.

Ebay just wrote off about $1.4 billion of the $2.6 billion
that it paid for VoIP company Skype. At the time of the purchase, Skype
had about 50 million registered users. By some measurements, that
number is now over 220 million.

Skype never became a big business from a financial standpoint
because users were not willing to pay money for add-ons to their free
VoIP service. Having tens of millions of users meant very little to the
ultimate value of the company.