Code Squabble Might Squash Skype
Article by George Norman
On 31 Jul 2009
We like each and every version of the popular IM and VoIP client Skype: the Windows version, the Mac version, the iPhone version and even the version for Windows Mobile-powered smartphones. Sadly for us, and all other Skype fans out there, eBay, the company that purchased Skype for $2.6 billion in 2005, plans on coming up with a separate version of the VoIP client.

According to a 10-Q regulatory filling, eBay has started to work on its own code that would replicate Skype. This is because Joltid Ltd., the company eBay bought Skype from, still owns part of the technology used in Skype – as such Joltid Ltd. will not let eBay do whatever it pleases with all of Skype’s code. eBay announced in April that it plans to turn Skype into an IPO (a separate publicly traded company), but in order to do so it needs access to all of Skype’s code.


Since Joltid Ltd. still has rights to part of the code, eBay thought suing would be a good idea. But with the trial having been scheduled for June (that’s next year), eBay thought it a better idea to begin work on its own Skype version. The bottom line is that the lawsuit and eBay’s attempt to come up with a total rebuild of Skype is bad for the user. If the lawsuit ends badly for eBay, the company announced it may have to shut down Skype.

“Although Skype is confident of its legal position, as with any litigation, there is the possibility of an adverse result if the matter is not resolved through negotiation. Skype has begun to develop alternative software to that licensed through Joltid. However, such software development may not be successful, may result in loss of functionality or customers even if successful, and will in any event be expensive. If Skype was to lose the right to use the Joltid software as the result of the litigation, and if alternative software was not available, Skype would be severely and adversely affected and the continued operation of Skype’s business as currently conducted would likely not be possible,” explained eBay in the 10-Q regulatory filling.

Tags: Skype, eBay, Code, Lawsuit
About the author: George Norman
George is a news editor.
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