Skype could be shutdown over licensing fight

eBay may be forced to shut down hit VoIP client Skype over a licensing dispute which has erupted between the company and Skype's founders.

The row, which has erupted between eBay and Skype founders Niklas Zennstrom and Janus Frii's company Joltid, is over the technology which Skype uses that was licensed to eBay but not sold to the company back in 2005 when eBay paid $2.6 billion (USD) for the service. Skype allows anyone to make a phone call using an internet connection and its software which currently has more than 40 million users worldwide, and is the most popular VoIP app by far, but eBay says without the technology which is being fought over, it could be forced to shut down the service. A report to the US Securities and Exchange Commission said:

"If Skype was to lose the right to use the Joltid software as the result of the litigation, and if alternative software was not available, Skype would be severely and adversely affected and the continued operation of Skype's business as currently conducted would likely not be possible."

eBay is believed to be researching a new and alternative solution to the software which is at stake if its bid to gain access to the technology in the licensing agreement fails, but says that is a worst-case scenario the outlook is grim.

"It (the alternative software) may not be successful, may result in loss of functionality or customers even if successful, and will in any event be expensive".

eBay is currently attempting to spin-off Skype, which has failed to generate any profit for the company and has never really 'fit in' with other services eBay offers. The case is due in court June next year.