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Week in review: eBay cuts off Skype

E-commerce giants cuts its Internet phone unit loose, while book publishers and authors grapple with Google. Also: The Internet turns 40.

Steven Musil Night Editor / News
Steven Musil is the night news editor at CNET News. He's been hooked on tech since learning BASIC in the late '70s. When not cleaning up after his daughter and son, Steven can be found pedaling around the San Francisco Bay Area. Before joining CNET in 2000, Steven spent 10 years at various Bay Area newspapers.
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Steven Musil
3 min read

eBay has finally found a way to hang up on Skype.

The e-commerce giant plans to sell its Internet telephone service unit to an investor group that includes Netscape founder Marc Andreessen's new venture. Under the deal, eBay will receive approximately $1.9 billion in cash and a note from the buyer in the principal amount of $125 million, for a total of $2.025 billion. The participants expect the deal to close in the fourth quarter.

The investor group, which will take a roughly 65 percent stake in Skype, is led by Silver Lake and includes Index Ventures, Andreessen Horowitz, and the Canada Pension Plan Investment Board. The remaining 35 percent of the Internet telephony service will be retained by eBay.

The parties said the deal values Skype, which is likely to see an IPO in the coming months, at $2.75 billion.

With the sale, eBay acknowledged that things hadn't worked out as planned with Skype, which it acquired for $2.6 billion in 2005 with the plans to offer customers the ability to discuss their transactions in real time. Over the course of the four years since then, eBay found that its acquisition failed to provide what it sought.

In other merger news:

EU to investigate Oracle-Sun deal

Regulators opens antitrust probe into pending merger, citing concerns that the deal may hinder competition in the database market.
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Advocates: Google Books can bridge digital divide

Civil rights and disability groups say Google's bid to create a new kind of digital library would transform the way the world accesses knowledge.
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Snow Leopard install downgrades Flash

The Flash Player is automatically downgraded when Mac OS X Snow Leopard is installed--a move one security expert said needs to be addressed immediately.
•  Regretful upgrade: Snow Leopard incompatibilities
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Photos: IFA through the years, a gadget evolution

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IFA 2009: Gadget-fest in Berlin

Like American counterpart CES, the IFA show in Berlin is a big stage for consumer electronics companies and their latest gizmos.
•  TV makers push3D at home

Gmail users suffer through outage

As the fast-growing and third most popular e-mail service goes down, the number of irate tweets about the Google application goes up.
•  Gmail outage blamed on capacity miscalculation

Researchers seek funds to study cell phone safety

Scientists have long debated whether cell phones pose a health risk, and now they're looking for money to fund research to help settle the debate.

YouTube wants to offer film rentals

This would be a natural progression for YouTube, a company that has for the past year attempted to become a hub for feature films, but no deals are done yet.

At 40, the Internet still reshaping history

The Net has crushed geographic barriers and withstood extraordinary growing pains. But the human race has work to do adapting to its creation.
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Jaycee's alleged kidnapper on Google Street View?

Some Boing Boing commenters put together a chilling montage of Street View stills that may show Jaycee Lee Dugard's alleged kidnapper following a Street View car.
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