
Cisco May Be Making A Run For Skype - mjfern
http://techcrunch.com/2010/08/29/cisco-may-be-making-a-run-for-skype/
======
terryjsmith
Okay, so here's the new plan for startups: develop your product and execute it
to near its full potential, then sell it to someone for $2B. But keep the core
technology (just tell them it isn't important and/or you're just licensing it
from this other corporation you just happen to own). Continue to collect
licensing fees on said core tech. Then, when that person can't put enough
time/effort/etc. into it, buy it back from them at 20% of the original price
(after they've taken a huge write down of course). Next, raise a ron of VC
money cause you're the shit, and then plan to IPO a very small portion of the
company. Finally, while you're in the process of doing your IPO, get bought
AGAIN, except for $5B this time. /rant

~~~
dcurtis
This is almost exactly what actually happened with WebShots (only with smaller
amounts of cash).

<http://en.wikipedia.org/wiki/Webshots>

------
mahmud
The article should mention Webex, instead of leaving that for the fluff in the
bottom.

<http://en.wikipedia.org/wiki/WebEx>

CISCO might want Skype just for the brand and userbase, since it already has a
VOIP platform, far richer than Skype's (except maybe for the P2P stuff)

~~~
rwmj
WebEx is the most horrible user-hostile piece of software out there, so
hopefully they'll kill it in favour of Skype.

~~~
nailer
One a remote desktop control tool, the other's a phone call app.

~~~
nuclear_eclipse
WebEx Connect is still a frustrating piece of "Enterprise" software that I
wish I wasn't forced to use on a daily basis.

------
Osiris
This acquisition certainly makes a hell of a lot more sense than the lame eBay
purchase. Seriously, how did anyone convince the board at eBay that purchasing
Skype would be a good thing?

At least Cisco is in the telecommunications business and could roll the Skype
brand and tech into real products.

~~~
huhtenberg
I was in the same state of WTF until I asked about it a friend of mine, who
was the CEO of one of larger Boston startups. It took him a couple of minutes
to crunch the numbers in his MBA head and to show that eBay's purchase price
was reasonable.

Apparently it _was_ a viable business transaction when it was conducted
(excluding the not-purchasing-the-core-technology part).

~~~
arethuza
Of course another possible explanation for this is that MBAs are all taught to
value things the same (crazy) way and he is simply running the same valuation
calculation as the MBAs at eBay and coming up with an equally crazy answer.

------
riffic
Cisco owns Jabber, inc. Maybe they'll turn Skype into an xmpp-based service,
allow federation with other service providers, and lose the proprietary
protocols.

or maybe not.

~~~
rwmj
What possible benefit would this be to Cisco or Skype or even to Skype's
current users?

~~~
mdasen
Cisco makes a lot of money on high-margin equipment to deal with IP traffic.
If an inter-operable VoIP solution becomes the future of communications (or
just raises the level of internet traffic in general) Cisco wins as people
have to buy more network equipment (of which a bunch will probably be their
equipment).

Skype's current business model is non-interoperability. If people are locked
into Skype for Skype to Skype calling, then they'll pay Skype Out rates to
dial phones. However, there can be a limit to how pervasive you can get with a
closed network model. Cisco might calculate out that increased hardware sales
would do them better. Likewise, they might feel that the Skype brand has
enough clout to stand on its own.

I'm not saying that it's likely, just that there is a potential benefit. More
internet traffic is probably a very desirable thing for Cisco.

~~~
rwmj
Skype's current business model is _very_ interoperable. I have a traditional
phone line right next to me which interoperates with Skype really well, and so
do a billion other people.

By contrast, VoIP has _never_ worked (until Skype came along, and even now all
non-Skype VoIP services are generally technical and business failures).

