Thursday, May 19, 2011

Skype vs. Linedin

Microsoft bought Skype for 8.5 bil.

Linkedin has a market cap gyrating at about the same amount?

Which would you rather own?

Linkedin has 100 mil users and 8 mil a year in profit.

Skype had 663 million user accounts (I have 2) in 2009 and surely more now.  
"Skype made a net loss of $7 million last year on revenue of $860 million, even as its user base grew nearly 40 percent to 145 million.
Microsoft Chief Executive Steve Ballmer said the deal would add to the company's profits from the first year, preferring to focus on the $264 million Skype made last year, excluding interest, tax, depreciation and amortization."  I don't understand the user base number.
I'd rather own Skype: more users, more revenue, more profit, unique technology.  LInkedin does have a valuable social graph of professional contacts.  Skypes social graph is much broader, but less clearly defined.  Skype connections are rather information and semi-anonymous and this might be MS's advantage.  Put everyone logged into Skype who wants to chat on a searchable map and you suddenly have a great tool for gathering local info.  Integration of Skype with geolocation into Windows Phone would make hyperlocal updates a reality.  For example: find someone in front of a nightclub and ask them to share via video the line so you can see the people and length.  Allow payments and you have a quick means of collecting local photos and video for mapping programs.   Skype could help MS leapfrog Google for real time street view.

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