SUBSCRIBE TO TMCnet
TMCnet - World's Largest Communications and Technology Community

CHANNEL BY TOPICS


QUICK LINKS




Microsoft Buys Skype

TMCnews Featured Article


May 11, 2011

Microsoft Buys Skype

By Gary Kim, Contributing Editor


Microsoft Corp. has bought Skype (News - Alert) for $8.5 billion, in an all cash deal. It is the biggest acquisition in the 36-year history of Microsoft, a company that traditionally has shied away from large deals.


Microsoft might would want Skype for a number of reasons. Video collaboration has become a leading growth area in the enterprise communications space, and Microsoft gains a huge brand, albeit consumer centric, that offers a much-used video calling and collaboration tool, with global usage and awareness.

It arguably gives Microsoft a new relationship with mobile service providers. Where it now offers devices and operating system access, with Skype, Microsoft is a conferencing and calling application provider. That is a complicated place to be, for sure. 

But in some cases, mobile carriers might want to partner with Skype or other application providers, to provide video calling and video collaboration.  In other cases, service providers will compete with Skype. Jajah, for example, is owned by Deutsche Telekom (News - Alert). 

As voice, text and communications increasingly become a feature of other applications, Skype could allow Microsoft to embed communications directly into Windows Mobile or other Microsoft applications. 

Skype also gives Windows Phone 7 a competitive offering to Google Voice and Apple’s (News - Alert) Facetime. 

Some observers might playfully note that Skype is just the sort of Internet business compatible with Microsoft: it loses money. It is true that Microsoft has struggled to find its footing in its Internet ventures. And there is a risk it is overpaying. 

But Skype is a recognizable, global Internet brand with lots of daily usage and 663 million registered users. With the recent Nokia adoption of Windows Phone (News - Alert) 7 operating system, Microsoft is poised to supplant Research in Motion (RIM) as the number-three smartphone operating system. 

That is a feat many would have doubted Microsoft could credibly be in position to accomplish, but now seems achievable. That would be quite a turnaround for Microsoft. Some had speculated that if Windows Phone 7 did not catch on, Microsoft would become irrelevant in the mobile OS market. 




Gary Kim (News - Alert) is a contributing editor for TMCnet. To read more of Gary’s articles, please visit his columnist page.

Edited by Jennifer Russell







Technology Marketing Corporation

2 Trap Falls Road Suite 106, Shelton, CT 06484 USA
Ph: +1-203-852-6800, 800-243-6002

General comments: [email protected].
Comments about this site: [email protected].

STAY CURRENT YOUR WAY

© 2024 Technology Marketing Corporation. All rights reserved | Privacy Policy