Big Sale Coming to eBay?

Today we hear rumors that eBay is planning to sell StumbleUpon websites discovery tool after acquiring it for $75 million last May. And people immediately began speculating if eBay we only see the beginning of eBay selling some non-core assets to focus on the main line of business facing the possible huge 10% rumored layoffs. The next candidate for sale suggested is obviously Skype since it is in a very similar position in relation to eBay’s main business as StumbleUpon is.

Usually big internet companies buy smaller companies for one of two reasons (or both): 1) they want to use their tools or technologies within their larger products and/or 2) they want to make money off the acquired products leaving them independent.

Unfortunately for StumbleUpon, it was never clear how eBay was planning to use this product. I am personally a very heavy StumbleUpon user (join me here, by the way) and a big fan of the community there and the product itself. But it has always been hard to figure out what exactly eBay was planning to do with StumbleUpon after the acquisition. One idea could be to suggest some products and auctions on eBay based on user’s preferences and interests that can be easily figured out from StumbleUpon. But while this could be useful, StumbleUpon probably has not managed to gain enough traction to provide substantial volume of information for such purposes.

Speaking about making money off StumbleUpon itself, the websites discovery tool does sound like quite a healthy product as it draws a mix of advertising and subscription revenue. Advertisers here pay to have their pages pushed at users when they discover new sites while subscribers pay to be able to turn off sponsored pages and create new groups.

I have paid for a couple of years of sponsorship for myself ($20 a year) and bought quite a number of sponsorships as birthday gifts to some of my StumbleUpon friends. It always seemed to me that I saw quite a good number of icons marking users as sponsors on StumbleUpon. Besides, I feel that StumbleUpon is pretty good in attracting advertisers because of the number of sponsored pages there. But without actual figures it is hard to tell how healthy the business is - and the question still remains if such a business can be worth $75 million eBay paid for it last year. So it looks very much like eBay may actually consider selling StumbleUpon and rumors have some basis.

But come to think of it, Skype is also a side product for eBay. When eBay acquired the VoIP service for $4.2 billion, the online auctions company was supposed to integrate the service into its auctioning process for buyers and sellers to use it as a communication tool. But for some reason it never worked out and Skype remained more of a standalone product for eBay after the acquisition. eBay has already admitted that it paid about $1 billion too much for Skype and it does not generate enough revenue for the acquisition to be considered reasonable now.

It is obvious that there are companies in the market that could use Skype much more efficiently - Google could use the product for VoIP on Android, for example. And Google is one candidate buyer for Skype that also has the money needed for a large-scale acquisition like this. But such a purchase could only happen if eBay really intended to improve financial situation it is now in by selling some non-core assets. Yet for now we have not even heard any confirmation of StumbleUpon rumors but if eBay is really selling StumbleUpon, it could prove to be looking to sell some other things it does not really need as well and Skype could be the first suggestion.