The internet video phone service Skype has announced its plans to go public with a $100 million initial public offering. Even though it will continue to remain in Luxembourg, the company will still have American depositary shares.
Skype has made more than $406 million in sales, and increased its users to 560 million, this year – a jump of nearly 50% from last year. A very small fraction of those users pay for the service, but even that jumped up 23% to a total of 8.1 million this year.
Skype believes the public offering will increase its abilities. It feels that while growth has been substantial, the amount of paying users is low compared to the market.
A deal this year between Skype and Verizon Wireless has made a huge impact in the business. Most mobile services were reluctant to even allow it, due to not being able to charge for the minutes used. But data service pays off as well, and this is helping Skype and rival Google Voice break into the industry.
Ebay purchased the service to use as a communication tool between buyers and sellers in 2005 for $2.6 billion. Their plans never quite materialized, so they sold the company to an investment group four years later for $2.75 billion.