Skip to main content

Microsoft Gets Green Light For Skype Acquisition

Microsoft clinched a huge win towards finalizing its Skype acquisition having now approvals from both the European Union and the United States to proceed.  In an $8.5 billion deal, Microsoft has secured perhaps its largest investment since its 2007 $6 billion purchase of aQuantive to expand further into online advertising.

“We’re pleased that the European Commission has approved Microsoft’s acquisition of Skype. This is an important milestone, as we’ve now received clearance from both the United States and the European Union. We look forward to completing soon the final steps needed to close the acquisition, bringing together the employees of Microsoft and Skype, and creating new opportunities for people to communicate and collaborate around the world,” stated Brad Smith, General Counsel and Executive Vice President, Microsoft Corporation.

What makes Skype so attractive to Microsoft is that Skype has become one of, if not, the most popular means of real-time communication through instant messaging and voice/video conferencing, a medium which has been widely adopted for both business and personal use on smartphones, desktops and tablet PCs.

While Microsoft already offers a variety of real-time communication solutions , boasting more than 500 million MSN users, it just doesn’t have the same reach that Skype will bring to the table. 

- Skype has partnerships in place with Facebook as the primary means to instant message and video chat Facebook friends. With Microsoft acquiring Skype and its 1.6 percent stake in Facebook, Microsoft will now have access to the potential 750 million Facebook users using Skype.

- Skype is actively used by Apple customers on their iPad and iPhones. Apple owns 74 percent of the Tablet PC market and almost 6 percent of the global phone market. Microsoft via Skype can also tap into this broad user base.

- Skype will facilitate for Microsoft a better means for user authentication and a wider reach in promoting its other products to the more than 170 million daily active Skype users.  It is one of the many strategic moves Microsoft  has set in place to reclaim its presence and market share in the smartphone and tablet PC arena.

Where Google and Apple currently dominate in the smartphone market, Microsoft hopes that its new partnership with Nokia Corporation, in a move to have Microsoft software power its smartphones, will make an impact with its upcoming Windows 8 OS targeted specifically for the smartphone and tablet PC market.

While it remains to be seen how successful this new acquisition will be for Microsoft, the rest of us can only await the outcome of whether this will affect our Skype usage fees as a means for Microsoft to recoup some of the billions spent on purchasing Skype.