Was eBay buying Skype the worst ever tech deal?

Auction giant can still get some cash back from sale

Was Ebay's historic Skype acquisition the worst deal in the history of the PC industry? Maybe not, but it's got to be on the shortlist. Dr Faustus negotiated himself a better contract.

First, let's consider the price. $2.6billion (in cash and shares) is a lot for any company to shell out, even for something as then-exciting as Skype and a share in the fledgling VoIP revolution.

Next, factor in the fact that if Ebay ever had a clue why it wanted Skype in the first place, we never saw it.

PayPal for $1.5billion? Sure. It's now the standard method of buying and selling on Ebay proper – that one makes sense. Skype? We didn't even see the much-mocked idea of buyers calling sellers to ask questions come to fruition, never mind anything that justified the exorbitant price.

No wonder Ebay has been trying to sell it on, but what exactly does it have to sell?

In a twist of fate that must have led to at least one former contract lawyer filling in a fast food job application form, we found out that Ebay had bought Skype, but not the key peer-to-peer technology behind it, which was still owned by the software's original developers.

To put this situation into some sort of context, it's the equivalent of Ebay having one wish and spending it on a lifetime's supply of tuna, but failing to persuade the genie to hand over a can opener.

But wait, that's not all! Just in case there wasn't quite enough salt poured into its already gaping wound, the moment Ebay finally managed to wash its hands of the whole messy business by finding a buyer for the service, Skype's original owners popped back up and hit the online auction house with a lawsuit, finally squirting actual blood from the emaciated cash cow's poor, withered udders. Right into Ebay's sobbing face.

What I'm trying to say here is that, firstly, I think this deal could probably have gone a little better.