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eBay Unites with Google For Skype Calling Service

By Saul Hansell

EBay is hoping its new partnership with Google will help it find new ways to make money from Skype, its Internet calling service. But experts wonder if enough people are willing to make the switch from traditional phones to talking through their computers.

A critical aspect of the deal announced Monday is that Google will introduce a feature that allows users to talk to advertisers by way of Skype, instead of just clicking through to the advertisers’ Web sites. Users of this feature, called click-to-call, would also have the option of using Google’s own Google Talk system or normal telephones.

Early tests by several companies indicate there is a group of advertisers, including mortgage brokers, who are willing to pay $8 to $15 for each call from a Web searcher, roughly 10 times more than they will pay for a Web site click. Under the Google-eBay deal, money paid by advertisers for calls completed through Skype would be split between the two companies, although the proportion of the split was not disclosed.

But most of these tests so far, including those by Google, are focused on calling using regular phones, rather than PC calling using services like Skype. Indeed, eStara, a company that provides pay-per-call advertising technology to companies including Verizon’s unit, offers both telephone and PC calling options. It has found that only 10 percent to 15 percent of people choose to talk using their computers, and that this proportion is not increasing.

“The vast majority of consumers want calls to be landline-based,” said John Federman, eStara’s chief executive. PC calling requires computers that are equipped with microphones, and a change in customer behavior.

Alex Kazim, the president of Skype, said that an increasing number of computers now came with microphones, and that consumers were increasingly using them.

“We see a shift over time as users become more and more able to do voice calling on their PCs,” Kazim said. He pointed out that Skype had 100 million users worldwide.

EBay bought Skype last year for $2.6 billion and additional payments based on its performance. It expects Skype to generate $200 million in revenue this year, mainly from fees for connecting PC calls to regular telephones and extra services like voice mail.

In an interview Sunday, Meg Whitman, eBay’s chief executive, said the click-to-call system could substantially increase Skype’s revenue, but she declined to say by how much.

Skype and Google will begin testing the system next year. So far, most pay-per-call advertising uses one of two technologies. In some, the ads simply display a telephone number for users to call as they would any business. But the number is used only for that advertising campaign, so each call can be tracked. In others, users enter their phone number on the Web and receive a call moments later from the advertiser.

Google has tested the latter system because it can record exactly what path a user took before initiating a call.

AOL, which is using pay-per-call in its Web search ads, uses the unique phone number approach, because it is easier to understand.