EBay Inc. is considering selling Skype Technologies SA to Google Inc., according to the rumor mill. On its face that seems plausible. The Internet telephony service has been a millstone around eBay's neck since the online auction company bought Skype in 2005 for up to $4.1 billion. But we'll go out on a limb in predicting that eBay won't sell Skype to Google, or to anyone else, for the foreseeable future (fortunately the blogosphere has a short memory).

When eBay announced third-quarter earnings in October, it acknowledged that Skype was underperforming. The good news was that this meant eBay was off the hook for $1 billion in performance-related incentives for Skype, cutting the final price tag to $3.1 billion. The bad news was that despite having nearly 250 million registered accounts, Skype brought in only $98 million in revenues in the quarter.

While Skype has weakened eBay's stock price, it doesn't make sense to sell the company at a low point before giving a new leadership team time to determine the best way to unlock the value of its huge user base. EBay recently added a Skype button to its online auction listings, making it easier for buyers and sellers to talk. The company also announced a deal with MySpace.com to allow users of the social networking site to place free Skype calls to other MySpace.com or Skype users.

The biggest problem for Skype is how to monetize its massive subscriber roll of 246 million users. It makes money by charging for outgoing telephone calls made through Skype to non-Skype members and from premium services. But the unit's revenue per user rate stood at a paltry 40 cents in the third quarter and isn't expected to improve near term. Skype's best chances to reap revenues from the service may be through pay-per-call advertising that connects consumers and local businesses through the Internet.

Of course, eBay could eventually decide to unload the company. Should Google table a bid, it might prove irresistible to try to induce a bidding war with rivals like Microsoft Corp. and Yahoo! Inc. in hopes of recouping a portion of what eBay spent. But applications like Skype, with its enormous footprint and superb technology, aren't easy to find. The Web auctioneer is unlikely to give up on the investment just yet. - David Shabelman

See Nov. 19 post from Guardian Unlimited