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Microsoft buys Skype for $8.5 billion

So the rumors are true that Microsoft is buying Skype for an allegedly $8.5 billion big bucks. Microsoft published the official press release a few moments back.

skyeeBay bought Skype back in 2005 for around $2.6 billion. Not having found any good use for it (was supposed to be integrated to the eBay), the auction site was ready to sell it off as early as 2008.

It was then bought in 2009 by an investment group (Silver Lake, eBay International AG, CPP Investment Board, Joltid Limited in partnership with Europlay Capital Advisors; and Andreessen Horowitz.)

The $8.5 billion agreement (to be paid all in cash) looks to be the biggest purchase Microsoft has ever made.

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 sale agreement is interesting considering that Microsoft also has it’s own VOIP service in the form of Microsoft Live. However, the 170 million strong user-base of Skype could be the biggest attraction to this agreement.

Microsoft will be creating a new business division called the Microsoft Skype Division, which will also be led by the current CEO of Skype.

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Avatar for Abe Olandres

Abe is the founder and Editor-in-Chief of YugaTech with over 20 years of experience in the technology industry. He is one of the pioneers of blogging in the country and considered by many as the Father of Tech Blogging in the Philippines. He is also a technology consultant, a tech columnist with several national publications, resource speaker and mentor/advisor to several start-up companies.

30 Responses

  1. Avatar for me me says:

    It is a copy-cat move to Apple’s Facetime.

    • Avatar for RJ RJ says:

      I love Skype. I am able to talk to my loved ones in the Philippines even when I am like 3000 miles aways from them. By the way, I am using Skype for Android, Apple’s Facetime sucks big time.

  2. Avatar for eagle eagle says:

    I hope Skype’s quality doesn’t drop with Microsoft in it and only becomes more effective. Systems like skype are quite sensitive. Skype really deserves something because it makes the communication so easier. There is no match for skype at the moment in the electronic communications industry.

    The price is low though I think. As compared to facebook which they price at $25 Billions, skype has more utility but it’s price is low!

    Eagle
    http://eseaf.com

  3. Avatar for Ry Ry says:

    Aww, I hope that Skype will still continue to develop Skype for Android Honeycomb…

  4. Avatar for bennix bennix says:

    Wow!a good move for Microsoft, hope Nokia will be supported by Skype din so there’s would significant improvements.

    Guy,s I just know Windows 8 screenshots is one of the hottest rumor this month….
    http://www.bennixville.com/2011/05/windows-8-leaked-screenshots-specs-and.html

    Thanks Yuga.What if Microsoft will buy Yugatech?

  5. Avatar for bus ads manila bus ads manila says:

    i think this is a good move from them, imagine you have 170 million user base :). Talk about upsells and rebills. Besides more businesses are moving to a more cheaper telecom services. Video conferencing should be a standard on all pc’s in the future too :)

  6. Avatar for nameless nameless says:

    Currently im using SKYPE for LINUX. what about now?

    • Avatar for mike mike says:

      its just like putting gameboy rom on psp umd. XD.

      no,i think it will work fine.

  7. Avatar for d d says:

    so microsoft lacks the faith for their own chat/online services like windows live and msn? their messenger basically offers the same features like skype. save for the landline and mobile calls features maybe.

  8. Avatar for florencia florencia says:

    wow. ibang klase talaga Microsoft.

  9. Avatar for sylv3rblade sylv3rblade says:

    This probably spells death for Skype on the PSP.

    Also, it makes sense to buy out skype considering they’re offering a similar service for their enterprise customers (with more Office integration).

  10. Avatar for iphonedevpinoy iphonedevpinoy says:

    MS will launch this as Microsoft Skype Network or Microsoft SkyNet :D

  11. Avatar for Zone Android Zone Android says:

    8.5 billion – a big number. Will Skype accept or they will like Yahoo ?

  12. Avatar for Roofer Roofer says:

    I love Skype. Hopefully MS will make it even better.

    • Avatar for limos limos says:

      yes you are right. I also hope that Skype will be integrated with new features.

  13. Avatar for Name: Name: says:

    8.5 billion…not a bad sum for the creators of skype, wow. I like that it will soon be integrated with xbox live and kinect, that’d be nice. I wonder though, any indication that the monthly price of skype may go up at all?

  14. Avatar for poche poche says:

    same as sa digitel yun ceo din ng skype ang uupo as head ng division na yun kaya wala problema mas gaganda pa nga infrastructure ng skype nian at mas dadami users since iintegrate sa ibat ibang ms products.

    by the way ang tinalo ng microsoft sa skype bidding e facebook at google.

  15. Avatar for adam adam says:

    ^^^ Nice Idea if ganun ang mangyari.

  16. Avatar for Fleeb Fleeb says:

    @benchmark: but unlike PLDT and Sun, Microsoft is competing directly with Skype. Google Voice perhaps?

  17. Avatar for kebbot kebbot says:

    I hope Nokia will have skype video calling soon…

  18. Avatar for benchmark benchmark says:

    sabi nga dun sa isang comment regarding buying sun by PLDT, “if you can’t beat them, buy them”.

    • Avatar for Fleeb Fleeb says:

      but unlike PLDT and Sun, Microsoft is not comp eting directly with Skype. Google Voice perhaps?

    • Avatar for Benchmark Benchmark says:

      As per the post, Microsoft have Microsoft Live…what I am saying is that, since Microsoft Live can’t beat Skype, they purchase Skype. Why didn’t just upgrade their Microsoft Live? Probably time..since andyan na yung system ng Skype, and may subscriber na din, why not buy them na lang…easiest way to beat the competing body. :)

    • Avatar for syunga ka ba?! syunga ka ba?! says:

      syunga ka ba?!,ang smart and sun direct competitor sila dahil pareho ang services na ino-offer nila, unlike microsoft and skype.

    • Avatar for Benchmark` Benchmark` says:

      Like what I posted above, Microsoft Live is directly competing with Skype.

      As the post below, I agree, somewhat Microsoft doesn’t trust their own infrastructure of MS Live, so better buy Skype na lang, para ok na lahat.

    • Avatar for Fleeb Fleeb says:

      Maybe against Cisco in the Enterprise? http://blog.seattlepi.com/microsoft/files/2011/05/skypegraphic.jpg

  19. Avatar for arj arj says:

    another merge again. i hope skype will still offer free calls

    • Avatar for tugak tugak says:

      dont worry, skype will offer more and more free calls to attract more and more users. in this way skype can gain more strength in delivering your voice by using neighbor’s bandwidth.

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