eBay chief predicts free phone calls in 4 to 6 years

eBay CEO Meg Whitman defended the company's $4.1 billion acquisition of Skype by asserting that since voice data services are moving more and more to the Internet, four to six years from now phone calls will be free. eBay expects the price for voice transmission to trend to zero because the pricing paradigm is shifting from revenue per minute to the size of the subscriber base or "ecosystem." eBay will soon allow users to pay for Skype calls with their Paypal accounts. Skype expects to generate about $60 million in revenue for 2005, with revenue growing to more than $200 million in 2006.

eBay's five pronged Skype plan includes integrating Skype with each of the company's brands and properties, getting every Skype user to use PayPal, sell click ads for inbound Skype calles, use the VoIP service to penetrate its hard-to-crack Asian markets and sell add-on Skype services. However, eBay did not break down how these prongs jointly point to $4.1 billion.

For more on eBay's designs on the VoIP market:
- take a look at this article from vnunet.com