In a move that could mark a big strategy shift for the online auction company, eBay is in talks to acquire internet telephony company Skype for between £1.09bn billion and £1.63bn.

The Wall Street Journal reported the discussions on Thursday, quoting unnamed sources. The talks are at an early stage and could still fall apart, according to one person briefed on the matter, the Journal reported.

Skype has talked with a few other interested buyers, including News Corp, Microsoft and Yahoo, the newspaper said, but none of these talks have led to deals.

The Luxembourg-based company, which provides a free VoIP (voice over IP) service in addition to several premium services, is also considering an IPO (initial public offering).

As the core business of eBay - online auction sales - matures, the company has been looking to expand into new product areas and international markets, according to the report.