Microsoft Mindblowing Buyout Of Video Chat Skype
Microsoft recently announced a huge deal that sees them become the official owners of web and video chat specialists Skype, after making the purchase for an eye watering $8.5 billion. That figure makes the $1.65 billion Google paid for Youtube, seem like peanuts..
The deal to buy the Internet ‘voice and video communications’ company comes at a time when the computing giant, who invented the Windows operating system, try to keep up and compete with rivals as their dominance of the desktop computer market is becoming less significant. Mainly due to the development of tablet computers and smartphones (amongst others).
Microsoft CEO Steve Ballmer announced the move, being paid for in full by money only (with no other properties being traded as part of the deal), during a press conference in San Francisco (USA), outlining their plans to launch the technology to a wider audience than before.
Such proposals have included updates to allow Skype video chats on gaming service Xbox Live (owned by Microsoft), online ‘business audio calls’ on Microsoft Outlook (an e-mail program), and ‘mobile conferencing’ via the Windows Phone. Skype already provide its 660 million+ users with the ability to video or audio chat for free to anywhere in the world, seen as a popular alternative to long-distance calls.
The deal is Microsoft’s most expensive purchase in history, and was made quickly to avoid the Luxembourg City (Luxembourg)-based company falling into the hands of companies which already have an arguably bigger stronghold on the web, such as Google and Facebook.
Ballmer said of the arrangement: “By bringing together the best of Microsoft and the best of Skype, we will empower people around the world with new technologies that should bring them closer together.”
Skype CEO Tony Bates (who is likely to become president of the re-branded ‘Microsoft Skype’ company) also pitched in: “We think this allows us to extend from hundreds of millions to literally billions. We believe this is a platform and a set of services that can reach everyone on the planet.”
Ballmer, meanwhile is insisting that Skype will still be available on non-Microsoft systems in order to avoid the disillusion of its current userbase.
Bern Elliot, vice president of Gartner Research, gave an independent suggestion that the two organisations are ‘complementary’, and would make the move a mutually beneficial one. He stated: “Microsoft is strong in the enterprise market and has struggled a bit more in the consumer markets. Skype, on the other hand, has been stronger in consumer than in business markets.”
Skype, created in 2003 by software developers Janus Friis and Niklas Zennstrom, are no strangers to being purchased by a larger entity, but a $2.6B sale to eBay in 2006 did not work out too well, and was classed as ‘gimmicky’, resulting in eBay selling Skype away for a cut-down price. Will they have better luck this time around in more experienced hands?
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