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October 20, 2005

eBay CEO Says All Phone Calls Will Be Free



Courtesy of Networking Pipeline

Within several years, all telephone calls will be made for free using VoIP, eBay CEO Meg Whitman told analysts during the company's earnings call yesterday, according to the Reuters news agency.

"In the end, the price that anyone can provide for voice transmission on the 'Net will trend toward zero," Whitman told analysts during the call..

Ryan said that service providers would make money from the phone calls through advertising or transaction fees.

The eBay CEO was responding to criticism from analysts who questioned whether eBay had overpaid when it bought VoIP provider Skype Technologies for $4 billion.

"The percentage of users that you can actually charge for (phone services) will actually go down, so I actually agree with that and we understood that when we looked at Skype," Whitman answered in response to a question from an analyst.

Whitman said that in the long run, VoIP providers with the "largest ecosystems" will thrive because their users can be sold on other services, such as PayPal which eBay also owns, or the highest-paying ads can be delivered to them.

In the call, eBay said that Skype will bring in an estimated $60 million in 2005, and more than $200 million in 2006.

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