Skype founders quit as executives

Business Materials 2 October 2007 05:45 (UTC +04:00)

( BBC ) - The founders of Skype, Niklas Zennstrom and Janus Friis, have resigned as executives of the web-based phone firm.

EBay has announced that it will cut up to $1.2bn (?590m) off the potential price it agreed to pay for Skype.

In September 2005 eBay agreed to pay $2.6bn for Skype and make further payments of up to $1.7bn based on Skype meeting various targets.

EBay will reduce the value of Skype on its books by $900m, a tacit recognition that it overpaid for the company.

"I think this is a testament that the Skype franchise is not worth as much as eBay originally thought," said Youssef Squali of the brokerage Jeffries & Co.

Skype generated only $90m in revenue in the three months to the end of June.

Ebay said it might pay Skype shareholders another $195m, but only if it sells 50% or more of Skype before then end of March 2008.

Mr Zennstrom, who was chief executive of Skype, will become non-executive chairman and is expected to spend more time on other projects.

After the Skype sale, he and Mr Friis founded an online video company called Joost.com.

Joost, which had previously only been available by invitation, made its software freely available on Monday.