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Skype poised to complete negotiations

The future of internet phone service Skype could be resolved soon, according to US reports, as a legal dispute over the core technology behind the service moves closer to a resolution.

The future of Skype was thrown into uncertainty after its founders launched a legal battle with a group of investors that won a bid to buy Skype from its owner, eBay, in September.

Skype founders Niklas Zennstrom and Janus Friis filed copyright infringement claims in a move that threatened to scuttle the investors' $1.9bn deal to buy a majority share in Skype.

Without the licences to the peer-to-peer core technology owned by Zennstrom and Friis through their company Joltid, Skype would be incapable of continuing its services.

But a resolution could be announced as soon as this week, according to the New York Times, which quotes several anonymous sources close to the negotiations.

The legal settlement is expected to restructure the group buying Skype to give Zennstrom and Friis a significant stake in Skype, in exchange for dropping the potentially crippling lawsuits.

London-based venture capital firm Index Venture is expected to withdraw from the deal after partner Michelangelo Volpi became the focus of litigation over the Skype deal.

Volpi, who worked for Zennstrom and Friis at a firm called Joost, was accused of using confidential information about Skype's software to assemble the buyout team and make a successful bid.

According to the sources, the deal is at a delicate stage and could still collapse.

Skype earned $185m for eBay in the last quarter. But eBay decided to sell its majority stake in Skype because it did not fit with the auction house's core business.


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