eBay auctions off Skype and StumbleUpon

eBay is divesting itself of StumbleUpon and, surprisingly, Skype. In what looks like a weird interpretation of a reverse auction, the company has sold StumbleUpon back to its original owners for less than it paid for it. The same would also have been true for Skype but talks broke down.

eBay looks as though it’s retracting to its core business which has upset quite a few of its supporters recently. The sale of StumbleUpon is no real surprise because it is not faring well up against Digg and other recommendation sites. Skype is a bit of a surprise. No, a shock.

According to The Guardian newspaper, eBay has been caught in a cleft stick. On one hand is a refusal by JoltID to allow its Global Index technology to be used by Skype. As this is the way that Skype organises calls, it means that eBay has to pay whatever JoltID may eventually ask as a licence fee or develop its own peer-to-peer network to underpin the voice over IP (VoIP) service.

Skype has no central server to establish calls. Instead, a Global Index is installed on a network of “supernodes”. When a call is established, Skype tries to connect them directly. If this fails, the Global Index tries to establish the call by linking the answerer to the caller rather than the other way around. If that fails, the index service connects the callers through a relay node.

Without Global Index, Skype doesn’t work. To add to this, Niklas Zennstrom and Janus Friis, the developers of Skype who sold the company to eBay, also control JoltID and therein lies the complexities. eBay wants to unload Skype, Zennstrom and Friis control the Global Index rights so no-one else would probably want to buy Skype. The whole mess is heading for court and eBay now plans to float Skype on the stock market next year as an independent company.

Skype me sideways, it all sounds like the plot to a nerdy soap drama. To any peer to peer expert developers out there, now might be a good time to register your CVs with eBay’s HR department.