Cisco Systems executive Tony Bates will be the new CEO of Skype, the latest shift in the rapidly changing UC field. Bates is the latest executive to leave Cisco for a competitor.
Cisco Systems is losing another executive to a competitor, with Tony Bates
leaving to become CEO of video conferencing and
VOIP vendor Skype.
Skype announced Oct. 4 that Bates, who most recently was senior
vice president and general manager of Cisco's Enterprise,
Commercial and Small Business Division, will take on his new position starting
in late October.
While at Cisco, Bates, reporting directly to CEO
John Chambers, oversaw a business that generated $20 billion in sales and had
more than 12,500 employees. The group oversaw such enterprise efforts as Cisco's
Borderless Networks, Data Center
He also was general manager of Cisco's $10 billion Service
Provider Group and was a key member of the company's executive planning unit.
"Skype is not only a powerful global brand but also a
global technology leader in Internet communications," Bates said in a
statement. "There are extraordinary opportunities ahead for Skype and I am
eager to lead the company through this exciting juncture in its continuing
In a blog post, Cisco Social Media Communications Director John
Earnhardt said company CTO Padmasree Warrior will take over Bates'
He described the group that Bates oversaw as "the heart of Cisco's
Earnhardt said, "Tony has been a great leader and asset to
Cisco over his nearly 15 years here. His leadership on innovations like the CRS-1,
Cius [tablet] and more have enabled Cisco to reach new markets and customers.
We never like to lose a Cisco family member, but the innovation engine which
began at our founding in 1984 will certainly continue."
Bates is the latest executive to leave for a competing vendor. Cisco
Fellow Jonathan Rosenberg left the company in November 2009 to become Skype's CTO.
And on Sept. 20, video communications vendor Polycom
hired Joseph Burton,
CTO for Cisco's UC
(unified communications) business since 2007, to become its senior vice
president, chief strategist and CTO.
Skype's choice of Bates comes at a time of rapid innovation and
consolidation in the burgeoning UC and video communications space. Cisco
officials have said they believe that within the next five years video will account
for 90 percent of all Internet network traffic, and collaboration technologies
could become a $30 billion business.
In 2009 the company bought Pure Digital Technologies, the maker
of the Flip personal video camera, and earlier in 2010 closed its $3.4 billion
acquisition of video communication vendor Tandberg.
Cisco also is looking to expand its video collaboration
capabilities. The company is expected to announce Oct. 6 a TelePresence
solution for the home.
Hewlett-Packard also reportedly plans to bring its
video communications technology into the home.
There also have been rumors that Cisco
was considering buying Skype.
Other vendors also are adding to their capabilities through
in-house innovation, acquisitions or partnerships.
Polycom in 2010 has announced a host of partnerships based around
UC and video collaboration with such
vendors as HP,
Avaya, Microsoft, BT, Juniper Networks and Siemens
Enterprise Communications Group. For its part, Logitech jumped into the video
communications market with its acquisition of LifeSize Communications.
Skype also has been looking to expand its reach beyond the
consumer space and into the corporate world. In May, the company began testing
a feature that would enable up to five people to participate in a video
conference call, and on Sept. 29 announced a UC
partnership with Avaya.
That announcement came two weeks after Avaya
unveiled an aggressive plan to expand its communications offerings into the
video realm, including via a tablet device that will compete with Cisco's Cius.
In addition, Skype is reportedly in discussions about a
partnership with Facebook.
Growing Skype's business will be a particular focus for Bates.
According to The New York Times, of Skype's 124 million monthly users, only 8.1
million are paying customers. In the first six months of the year, the company
made $13 million on $406 million in revenue.
eBay bought Skype for $2.6 billion in 2005, and in November
2009 private equity firm Silver Lake Partners bought a majority stake in the
company. eBay still owns 30 percent of Skype and there are a number of other
Joshua Silverman, an ex-eBay executive, has been Skype's CEO
"I am proud to have led Skype's growth during this
critical transition period," Silverman said in a statement. "The
company today has over 560 million registered users in nearly every country and
continues to develop products and services our customers love to use. With a
world-class communications industry veteran like Tony, Skype is well positioned
to become the communications platform of choice for consumers and businesses
around the world."