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Internet auction giant eBay is set to offload its highly successful communications company Skype

Despite Skype’s popularity, responsible for 8% of the world's international phone calls and generating revenues of $551 million in 2008, since its purchase in 2005 for $3.1 billion, eBay has struggled to integrate Skype’s functionality into a viable business model. ‘It's clear that Skype has limited synergies with eBay and PayPal’, admits eBay boss John Donahue.

Such was eBay’s misjudgement of the Skype/eBay potential that it took a $1.4 billion write-down on the asset in 2007. Donahue also admitted to the BBC that the Skype purchase was not the wisest of investments believing that ‘separating Skype will allow eBay to focus entirely on our two core growth engines - e-commerce and online payments - and deliver long-term value to our stockholders.’

Many analysts predict that Skype’s future is as a standalone service such is the multi-platform, non-proprietary strength of the service it offers. As many as 14 million people use Skype simultaneously and Skype is even an integrated service offered by a range of mobile phone providers and is one of the iPhone’s most popular applications with more than a million downloads in the first 36 hours.

There is talk that eBay is considering an IPO as the preferred method of selling the company, however in the current economic climate (with just one IPO this quarter raising $800m compared to 20 in Q1 2008 raising $24bn).

Having got it wrong buying the company the last thing eBay want to do is mess up the sale. They may get a better price by selling Skype on to another tech company. Google, Microsoft and Yahoo and Apple have all been mentioned as potential suitors and each would certainly love access to Skype’s 405 million users. Other potential suitors include original owners Niklas Zennstrom and Jannus Friis who are reported to have aligned 4 private equity groups in an effort to repurchase the company.