Skype Reported to be in Talks to Buy San Diego’s Gizmo5

When I wrote about founder Michael Robertson in December, the San Diego serial entrepreneur had just launched Gizmo5, an updated version of his free VoIP (Voice Over Internet Protocol) software and peer-to-peer network for making Internet-based phone calls. In my headline, I asked, “Michael Robertson is Calling, But Will Anybody Answer?”

Ten months later, it looks like Skype might just pick up. Citing “multiple sources,” TechCrunch’s Michael Arrington reports that Skype is in negotiations to buy Robertson’s Gizmo5, with the price tag “in the $50 million range.” I queried Robertson about the report last night, and he responded, “I can’t comment on the skype acquisition rumors.”

EBay, which paid $2.6 billion to acquire Skype four years ago, is now trying to sell the company to an investor group. But as TechCrunch notes, Skype doesn’t have all the corners of its core technology tacked down. That technology is now the subject of separate patent lawsuits filed against Skype and prospective buyers Mike Volpi and Index Ventures. As Arrington points out, the IP suits put Skype’s core technology at risk, which puts its service at risk, which is why acquiring Gizmo5 and its competing peer-to-peer technology makes sense.

Aside from any funding that Robertson has personally sunk into Gizmo5, the startup got $6 million in venture capital about three years ago in a round led by New York’s Dawntreader Ventures. Robertson also tells me that Gizmo5 currently has about 6 million subscribers. Skype has more than 405 million registered users.

Bruce V. Bigelow was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Follow @bvbigelow

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