BUSINESS

Microsoft acquires Skype

TAGs: Google, microsoft, Skype

Microsoft announced today that it has entered into a definitive agreement to acquire Skype for a purchase price of US$8.5 billion in cash from an investor group led by Silver Lake.

This is a done deal as the agreement has been approved by the boards of directors of both Microsoft and Skype.

The acquisition will increase the accessibility of real-time video and voice communications, bringing benefits to both consumers and enterprise users and generating significant new business and revenue opportunities.

The combination will extend Skype’s global brand and the reach of its networked platform, while enhancing Microsoft’s existing portfolio of real-time communications products and services.

Skype will now support Microsoft devices like Xbox and Kinect, Windows Phone and a wide array of Windows devices, and Microsoft will connect Skype users with Lync, Outlook, Xbox Live and other communities.

“Skype is a phenomenal service that is loved by millions of people around the world,” said Microsoft CEO Steve Ballmer. “Together we will create the future of real-time communications so people can easily stay connected to family, friends, clients and colleagues anywhere in the world.”

Skype will become a new business division within Microsoft, and Skype CEO Tony Bates will assume the title of president of the Microsoft Skype Division, reporting directly to Ballmer.

“Microsoft and Skype share the vision of bringing software innovation and products to our customers,” said Tony Bates. “Together, we will be able to accelerate Skype’s plans to extend our global community and introduce new ways for everyone to communicate and collaborate,” Bates said in the release.

The acquisition is subject to regulatory approvals and other customary closing conditions. The parties hope to obtain all required regulatory clearances during the course of this calendar year.

This is one of the biggest social media acquisitions of the year, but did Google drop the ball on this one? Did Microsoft pay too much for this innovation? How easily can Microsoft implant Skype into its ecosystem?

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