Microsoft's week proved fairly momentous in the acquisitions department: The company announced the finalization of its $8.5 billion Skype purchase, transforming the formerly independent communications entity into a business division.
"This represents a huge leap forward in Skype's mission to be the communication choice for a billion people every day," Tony Bates, formerly Skype's CEO and now president of Microsoft's Skype unit, wrote in an Oct. 13 posting on The Official Microsoft Blog. "Joining forces with Microsoft is the best way to accelerate this mission and capitalize on our position at the intersection of social, mobile and video communications."
Bates now reports directly to Microsoft CEO Steve Ballmer. Skype's services will be meshed with a variety of products in Microsoft's portfolio, including its Lync unified communications (UC) platform, Outlook and Xbox Live. Moreover, Skype's enormous user base gives Microsoft increased influence over the evolving voice over IP (VOIP) and video conferencing market.
Microsoft has indicated that it will continue to support Skype on non-Microsoft client platforms. Certainly the acquisition places Microsoft on an even-tighter collision course with Google, which offers its own VOIP services, and Apple, whose iOS devices feature the FaceTime video-conferencing app. But the potential market upside is huge: according to a 2010 survey conducted by the Pew Research Center's Internet & American Life Project, the combination of Skype, Google and Apple has lifted the number of American adults participating in online video calls to nearly 20 percent.
Speaking of partnerships, Microsoft also announced that it would include pairing with Hortonworks to augment Windows Server and Windows Azure with Apache Hadoop, a scalable solution for companies looking to crunch massive amounts of data, sorting through it to find the tendencies and patterns necessary to make better business decisions.
Organizations such as eBay and Facebook already use Apache Hadoop's open-source framework for production or educational purposes. Yahoo nurtured Hadoop as a "science project" of sorts for six years before it split off under the umbrella of the venture capital-funded Hortonworks.
"Over 80 percent of new data being generated is from unstructured sources," Eric Baldeschwieler, CEO of Hortonworks, wrote in a statement released by Microsoft. "We are excited to work with Microsoft to help make Apache Hadoop a compelling platform for storing and processing data."
Microsoft also kept up with its Windows 8 ramp up, with a new blog post justifying its next operating system's tile-based start screen. Like its choice to include the "ribbon" user interface in the Windows 8 version of Windows Explorer, the decision to include a start screen composed of active tiles is proving somewhat controversial for a subset of Windows watchers.
"We know major changes like this can be controversial and we are looking forward to continuing this dialog with you," Marina Dukhon, a senior program manager lead on Windows' Core Experience team, wrote in an Oct. 11 posting on the "Building Windows 8" blog, which serves as one of the primary channels for Microsoft talking about the upcoming operating system. "I wanted to address some of the specific topics that have been brought up so far as they pertain to the design."
In the current Windows format, the Start button opens a menu with a list of applications. An "All Programs" tab within that menu opens a plethora of folders and subfolders. Microsoft's engineers believe this is an inefficient system, particularly in light of increased user focus on apps and Websites-hence the shift to this new format, which will supposedly help with touch-centric form factors such as tablets.
Microsoft is also ushering "Mango," a major update to its Windows Phone platform, into the world. Microsoft hopes that Mango's new tweaks and features, combined with some new phone-producing agreements with manufacturers such as Nokia and Samsung, will allow Windows Phone to finally gain some traction among businesses and consumers.
To help it toward that goal, Windows Phone division president Andy Lees used an Oct. 11 interview with The Seattle Times to take some swipes at Microsoft's competitors in the smartphone realm. He criticized the new iPhone 4S for not giving consumers "more choice" in terms of hardware. But he reserved some of his strongest words for Google Android.
"I think Android is heading down this chaotic phase," he said. "If you've used some of the (Android) phones, some of them are great, but some of them are not great. But it's random."
It remains to be seen, though, whether Windows Phone can threaten either Apple's iOS or Google Android in terms of market share.