Microsoft Acquires Skype

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Microsoft Acquires Skype

Under the terms of the agreement, Skype will become a business division within Microsoft, headed by Skype CEO Tony Bates.

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Growing Audience

Microsoft CEO Steve Ballmer cited Skypes rapidly accelerating number of users as a reason behind the unsolicited offer. Skype services will be meshed with a variety of products in Microsofts portfolio.

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User Expansion

During a May 10 press conference, Bates suggested that the Microsoft partnership could allow Skypes base to expand to literally billions of users.

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Client Platforms

Also during the press conference, Ballmer suggested that his company would continue to support Skype on non-Microsoft client platforms.

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Leveraging Assets

According to Microsoft, Skype assets will find themselves integrated into everything from Xbox Kinect to Windows Phone—pending regulatory approval.

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Google Competition

For Microsoft, the Skype acquisition opens yet another competitive front with Google, which also offers VOIP services.

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iOS and FaceTime

Apples FaceTime video-conferencing service represents yet another competitor to Skype and something Microsoft will have to take into account.

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Despite acquiring Skype, Microsoft will continue to support its Lync unified communications platform.

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This will be Skypes second time being bought by a major tech player. Then a two-year-old company, Skype in 2005 was bought by eBay for $2.6 billion in cash and stock.

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Skype boasts an average of 170 million users a month. Although the company previously had IPO plans, it put those on hold in October 2010 after the appointment of Bates as CEO.

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