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Tuesday, May 10, 2011

Microsoft Buys Skype for $8.5 Billion

Microsoft agreed to buy Skype Technologies SA for $8.5 billion in cash to gain the world’s most popular Internet calling service and its 663 million customers. The takeover may help Microsoft Chief Executive Officer Steve Ballmer attract Web users and narrow Googles lead in Internet advertising.

Microsoft offers voice chat services to consumers through its Windows Live Messenger software, and to corporate customers through its Lync collaboration platform Tightly-integrated Skype services could be an added selling point for Windows Phone 7, the mobile operating system Microsoft is promoting as a competitor to Google’s Android and Apple’s iOS, CCS’s Pescatore said.

Skype, which started as a way for consumers to chat for free online, is developing premium services such as group video calling and pursuing corporate accounts. Skype’s competitors include the fledgling Google Voice service and video chat client Fring.

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