Skype filed for an initial public offering Aug. 9, with a prospectus that offered a glimpse into the company's current structure and plans for future growth that include Skype for Business products.
VOIP vendor Skype filed for an IPO Aug. 9, but offered no indication of
when potential shareholders would be able to purchase stock in the
Internet-calling company.
Skype's
preliminary prospectus estimates the initial offering's value at up to $100
million, but the company declined to reveal a
specific share price to the Associated Press.
The prospectus also reveals certain fundamental details about the company: Monthly
connected users now average 124 million, with a monthly paying user base of
between 6.6 million and 8.1 million. During the first half of 2010, users made
95 billion minutes of voice and video calls using the service, with video calls
responsible for around 40 percent of Skype-to-Skype minutes. Skype also hosted
some 84 million SMS text messages during that period.
"We believe our highly scalable peer-to-peer software infrastructure
gives us a significant cost advantage compared to conventional communications
networks because it utilizes our users' existing Internet connections,"
the prospectus reads, "and does not require us to build or maintain a
physical communications network." That combination of lower cost and
scalable software architecture, the company insists, places it in a superior
position vis-??Ã-vis its competitors.
With regard to net income, however, the prospectus also reveals that Skype
operated at a loss in 2009, after experiencing positive net income in 2008.
From 2005 to 2007, the company also bled cash.
In September 2009, eBay
announced it would resell a majority of Skype to outside investors for $1.9
billion, four years after acquiring the property. The investor group,
headed by Silver Lake Partners and including Marc Andreessen's venture-capital
firm Andressen Horowitz, negotiated for some 65 percent of the service. That
represented something of a markdown for eBay, which paid $2.1 billion for Skype
in 2005.
Silver
Lake Partners and its fellow investors eventually saw their share reduced to 56
percent, with a 14 percent portion going to Joltid, a peer-to-peer company
created by Skype's original founders. Joltid had filed a lawsuit against Skype,
eBay and their investor partners in September 2009, alleging copyright
infringement; their share in the deal was part of the eventual settlement. For
its part, eBay kept 30 percent of Skype.
Skype indicated in its prospectus that, while the bulk of its current income
is derived from the SkypeOut product that allows "low-priced calling to
landlines and mobile devices," a future increase in revenues will come
from a larger user base, new products such as group video calling, licensing and
marketing, and Skype for Business products aimed at SMBs and larger firms.
Skype
has also tried to increase its market presence through initiatives such as a
free iPhone app with iPad compatibility, which was launched in April.
Nicholas Kolakowski is a staff editor at eWEEK, covering Microsoft and other companies in the enterprise space, as well as evolving technology such as tablet PCs. His work has appeared in The Washington Post, Playboy, WebMD, AARP the Magazine, AutoWeek, Washington City Paper, Trader Monthly, and Private Air. He lives in Brooklyn, New York.
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