Software giants battle on; Microsoft buys Skype

Last Updated 14 years ago by Kenya Engineer

Microsoft has paid $8.5 billion to acquire the leading Internet communications company,Skype.Microsoft is now trying to walk a line between leaving the Internet communications service independent while integrating with its vast array of products.

The acquisition will increase the accessibility of real-time video and voice communications, bringing benefits to both consumers and enterprise users and generating significant new business and revenue opportunities. The combination will extend Skype’s world-class brand and the reach of its networked platform, while enhancing Microsoft’s existing portfolio of real-time communications products and services.

With 170 million connected users and over 207 billion minutes of voice and video conversations in 2010, Skype has been a pioneer in creating rich, meaningful connections among friends, families and business colleagues globally. Microsoft has a long-standing focus and investment in real-time communications across its various platforms, including Lync (which saw 30 percent revenue growth in Q3), Outlook, Messenger, Hotmail and Xbox LIVE.

Skype will support Microsoft devices like Xbox and Kinect, Windows Phone and a wide array of Windows devices, and Microsoft will connect Skype users with Lync, Outlook, Xbox Live and other communities. Microsoft will continue to invest in and support Skype clients on non-Microsoft platforms.

The challenge for Microsoft is that it has to preserve what makes Skype great while getting bang for its buck. Microsoft is not alone with its acquisition and integration paradox. Given the acquisition-happy tech sector these integrations are a huge deal for the vendor as well as technology buyer.

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