How did Skype, founded just three years ago, manage to parlay itself into that kind of prize? Sure, it has 54 million users hooked on its free phone service. But with revenues expected to hit just $60 million this year and break-even not likely until late 2006 even should Skype's rapid subscriber growth continue, the price astonished many observers. Good timing is part of the answer, given the huge appetite among media and Web companies for an Internet-telephony play. At the same time, Skype and its advisers proved themselves to be master salesmen.
I'm all for putting money into something based on potential. But billions? Whew. Somebody must see way more synergy than I do.