Microsoft Buys Skype, Synergy

The news has come through today that the world's favourite free P2P VoIP service - Skype - has been bought by Microsoft for a fairly gobsmacking $8.5 billion dollars, which makes it the Seattle software giant's largest acquisition to date. "The Skype brand is a verb!" declared Microsoft CEO Steve Ballmer at the press conference in San Francisco, which presumably comes as news to Skype-users and grammarians alike. Inevitably, the announcement was liberally peppered with similar, Dullard-Class corporate aphorisms, but by sifting through these determined listeners could work out that Skype will become its own entity within Microsoft - evocatively titled Microsoft Skype Division - and existing CEO Tony Bates will remain in charge. He will report directly to Ballmer, thereby being privy to new verbs at the source. That's swell for Tony Bates, but what does this mean for Skype users? Will it continue to be free?

The good news is that Skype calls will almost certainly remain free. Microsoft has paid a premium for a vast user-base (about 170 million), and making them pay for calls would be a good way of halving that user-base at a single stroke. However, it will be interesting to see whether the video conferencing features will remain free, since it partially competes with existing Microsoft products. Time will tell.

For Microsoft, the aim will be to integrate Skype functionality into as many related services and platforms as possible. The key word is synergy, which we cannot have enough of. The example given by Ballmer was of being caught in traffic on the way to a conference, and the realisation dawning on him that he could have done the whole thing via web conferencing from his office. I didn't really understand this bit, but I'm willing to concede that something might have been lost in the translation from enthusiastic Microsoft-speak to English. Either that or his epiphany struck back in 1999, and he's been saving it up. I thought we could do web-conferencing now? It's just nice to have actual people there talking at conferences, even when they're just inventing new structure grammaticals.