

Skype's Evil Ways, Continued - alanthonyc
http://blogs.reuters.com/felix-salmon/2011/06/27/skypes-evil-ways-cont/

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MaysonL
Silver Lake and Andreessen Horowitz have shot their reputations to hell and
gone: they will have increased difficulty in finding deals and the companies
they fund will have harder times finding staff. Live by the sword, die by the
sword.

~~~
chalst
Silver Lake won't care. PE firms are used to being called locusts, pump and
dump schemers, or worse, and they don't need to be liked to do what they do.

Andreessen Horowitz will, though, not be happy about what happens to their
reputation in Silicon Valley.

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suking
A.H. will probably just blame it all on Silver Lake - I believe A.H. was quite
the minority shareholder anyways.

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raganwald
Even so, when tech companies are hiring, one of the things they do is trot out
the list of investors to establish their credibility.

The salient question is whether potential hires will (a) Forget all about
this, (b) Remember it and blame Silver Lake, or (c) remember it vaguely and
think A.H. was involved?

I have no idea what the outcome will be, but I'm guessing that (b) is way less
likely than (a) or (c).

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rlpb
Aren't they busy destroying Skype's value? Who is going to want to work for
Skype now, and how are they going to find talent?

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hvs
Once the deal goes through, they will be Microsoft employees. Until then,
certainly this will hurt their image, but I doubt that _no one_ would work for
Skype (of course, _I_ wouldn't).

~~~
rbanffy
> Once the deal goes through, they will be Microsoft employees

My two cents: Microsoft is known for being unethical _with its competitors_ ,
but never with its employees. Right now, Microsoft is in a position it can
take a stand for what's right and refuse to complete the acquisition unless
Skype aligns its HR policies with the company making the acquisition.

Microsoft is not paying 8.5B for the code. They are buying the Skype brand and
the loyalty of its customers (at least the ones running Windows). What Skype
is doing - and that's something that's hitting mainstream press soon - will
damage the brand - and possibly customer loyalty - irreparably.

And, by provoking a diaspora of the talented people, they are creating dozens
of competitors.

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hvs
I completely agree, but I wouldn't assume that Microsoft isn't doing anything
behind the scenes. When you are dealing with an issue that is generating bad
press like this but your company isn't the cause (i.e. Microsoft) but it has
the potential to hurt you, it doesn't always serve you to deal with it
publicly. Microsoft's name isn't currently tied to the bad press, so it's in
their best interest to work behind the scenes to do damage control without
linking their name in the public's mind with the unethical dealings of Skype
and Silver Lake.

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rbanffy
This is a matter to be dealt with publicly. What is being perceived is that
Microsoft, at best, doesn't really care for the Skype folks. The worst that
can be read into its silence is that they favor it because they never had the
intention to keep the team and this spares them some bad press.

If Microsoft does nothing, that's because they prefer Skype to continue its
behavior because Microsoft perceives it increases the value of the assets
being purchased.

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hsmyers
Would be interesting in a cold hearted intellectual sort of way to calculate
just how much the difference would be from an honest pay-out to Skype's sharp
business practice (Microsoft speak for screwing someone over...)

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rdl
Rounding error, I think. Probably no more than $200mm on an $8.5b deal.

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Retric
While 8.5/(8.5-.2) -1 = ~2.4% if your options are based on a 6 billion value
then (8.5-6)/(8.5-6-.2) -1 = ~8.7%. And don't forget incentives are often
based on meeting specific targets so someone in the private equity firm could
easily see a 20+% gain from this.

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rdl
Skype seems to be the equivalent of the Loc-Nar from Heavy Metal, turning
everyone who has contact with it evil.

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Kurtz79
Especially since being bought by Microsoft, it seems.

Steve Ballmer must have a reality distortion field as well, only with the
opposite polarity than Steve Jobs's.

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hammerdr
While I think you're just making a joke and may already know this, it is
important to keep in mind that Microsoft's involvement with this is probably
very minimal and seems to be a no-win situation for it (edit: them?
Interesting. It seems natural to say "them" here verbally but we use companies
in the singular form. E.g. "Microsoft is.." instead of the British way of
"Microsoft are..." yet the pronoun of Microsoft is them?)

~~~
Angostura
Offtopic, but ex-British journalist here. Every styleguide I've seen over here
says 'companies are singular'.

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rms
Can't we all just be nice and wait for the lawsuit?

