This column was originally published on RealMoney on Jan. 25 at 11:42 a.m. EST. It's being republished as a bonus for TheStreet.com readers. For more information about subscribing to RealMoney, please click here .
To me, the story at eBay ( EBAY) was Skype's amazing results. eBay is still roundly trashed for having made that acquisition, but that will change shortly. Almost a year ago, I wrote about how eBay's acquisition of Skype was wholly a bet on the Skype service reaching critical mass and becoming a de facto standard in VoIP. Last night, eBay announced there are now 171 million Skype subs, and that total is obviously growing steadily. I can tell you anecdotally that several colleagues, partners and friends have lately mentioned using Skype, especially to talk business overseas. Indeed, I use Skype often with my RevEcho.com programmers in India. Skype is a great play on the still-just-burgeoning outsource movement that's creating so many jobs here in the U.S. and in India. We're all leveraging the Internet and tools like Skype to create new efficiencies in our lives, businesses and economies. The point is that Skype has now indeed become the de facto standard in VoIP. eBay is likely to look very smart in a few years for this acquisition. That said, the rest of eBay's business -- the marketplace and PayPal -- are no longer dominant. The company has simply burned one too many sellers with its fee-structure moves over the past few years. And PayPal isn't nearly functional or friendly enough for Web developers and shopkeepers to use anymore. Google ( GOOG) Checkout is going to steal huge market share from PayPal. Again, I'm speaking from anecdotal, but meaningful, experience as I'm no longer going to use PayPal as a payment system for TheCodyReport.net. The upshot is that, like Yahoo! ( YHOO), eBay's core business will continue to grow, if only because the Internet will continue to grow. The Skype division -- and its success or lack thereof -- is what will drive this stock in the coming years. Because I'm bullish on Skype even as I'm bearish on most of the rest of eBay, that makes me bullish on eBay -- but not enough to invest in it.