The small London-based business seems to have cornered the market in internet telephony. In only two years, Skype has attracted 53m users, a number that continues to grow rapidly: its software has been downloaded more than 160m times.

Internet telephony, or voice over internet protocol (Voip), is exciting a lot of interest because most experts expect it to replace traditional telecoms networks, which still generate billions of pounds in revenues. Breaking voice calls into packets of data and transmitting them over the internet is much cheaper. Skype’s success shows just how rapid the technological switch could be.

Yet reports last week that Ebay was interested in acquiring Skype rattled Wall Street investors. Ebay shares fell 4% to $39 on the suggestion that it might pay anything from $2 billion to $5 billion for its target.

Even in the internet world, where Ebay, Google and Yahoo all trade on outlandish multiples of their revenue and profit, that would represent a generous price.

The breakneck pace of Skype’s growth reflects the fact that it does not charge for most of the calls it carries.

Skype has introduced paid-for services, enabling its users to call out to, and receive calls from, conventional telephone numbers. Some 2m people have signed up for SkypeOut and SkypeIn, depositing €10 or more with the firm.

For a two-year-old company, this progress is impressive. However, it’s also clear that total revenues must still be in the tens of millions of pounds, rather than the hundreds of millions. Few analysts doubt the threat that Skype poses to the conventional telecoms industry.

However, it remains far from clear how the company will profit from this enticing market position.

It is similarly unclear what Ebay might hope to gain. Analysts have speculated that Ebay may want to introduce telephony to enable buyers and sellers in its marketplace to communicate more easily. Even so, many think $3 billion would be a high price.

“I don’t see a lot of point to Ebay buying Skype,” said Martin Pyykkonen, an analyst at the American firm Hoefer & Arnett. “If Ebay were to make this sort of move it would basically be admitting ‘our core market is decelerating’.”

And that is the bigger challenge facing Ebay. After 10 years of hectic growth, even through the dotcom slump, its auction business has this year shown the first signs of a slowdown. “Disappointing” results in January sliced a third off its shares.

Buying Skype would be a radical departure by Ebay from its core business. The company refused to comment but has long said it plans to increase its market share in internet commerce and would explore new areas to do so.

As its auction business matures, Ebay is searching for new product categories and international growth. In the past year and a half it has bought in to rental-property listings, online classified advertising listings and comparison shopping. It also owns PayPal, an online payment system already available to Skype’s paying subscribers.

As Google and Yahoo broaden their offers, they encroach on Ebay territory. By acquiring Skype, Ebay could set itself apart from its rivals by offering low-cost voice services exclusively to customers.

One source close to Ebay said: “Ten years from now we are not all going to be accessing the internet through a keyboard. Ebay needs to make sure that it stays at the edge of how the market is developing.”

In an interview with The Sunday Times recently, Janus Friis, one of the co-founders of Skype, suggested the company was in no hurry to surrender its independence: “We are building the business as an independent company. We have created something very, very big.”

Friis also said the money from SkypeOut and SkypeIn was funding expansion plans: “We are not in any need for cash.”

Yet, although Skype will not confirm it, it is taking advice from investment bankers at Morgan Stanley. If it doesn’t need to raise money and it is not seeking a sale, why does it need the help of investment bankers? A flotation might be one answer.

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