Microsoft agreed to buy Skype for 8.5 billion dollars.
http://online.wsj.com/article/SB10001424052748703730804576314854222820260.html (The Wall Street Journal)
http://www.zdnet.com/blog/microsoft/microsoft-buys-skype-for-85-billion-creates-new-business-division/9406
I don't understand why Microsoft needs to buy Skype. Mr. Ballmer said "this deal will let Microsoft be more ambitious, do more things". Some columnist said it is all about advertising revenue, and some analysts said it is about acquiring access to the 650 million Skype users worldwide. According to the article by WSJ, there are 170 million people logging in to Skype every month. MSN had near 500 million monthly users by end of 2007, when Bing was not even part of the MSN family. Hotmail has at least 360 million users and MSN Live Messenger already has 330 million users in 2009. Skype is popular on PC as a video/audio communication application, and 90-plus percent of PC's on earth use Microsoft Windows operating system which is pre-loaded with Messenger and Internet Explorer pointing back to MSN family of services. It means that 90-plus percent of Skype users are either already Microsoft users or accessible to Microsoft. I don't see what Skype can do for Microsoft in terms of advertisement revenue and access to user base that Microsoft cannot do with its MSN service. It is neither more ambitious nor doing more things. The number does not add up.
This purchase is not for VoIP (Voice over IP) technology as Microsoft has that technology already, and VoIP is not worth that much money. I wonder Microsoft will actively promote Skype on Windows Mobile. Mobile telecom operators are already antagonized by Skype. Skype loaded Windows Mobile will automatically take itself out of the A-list from many mobile operators. In the office, users who use Skype are probably not paying customers, though most of them pay for other Microsoft products. At home, there may be some opportunity for Microsoft. I hope Microsoft will keep the application simple. Product integration based on the buzz word "synergy" will only bring confusion to end users. Will MSN Messenger be on the chop board? I hope not yet fear so.
Skype's shareholders are big winners. Among them, EBay owns thirty percent of Skype, and can finally conclude its chapter on Skype. I would like to see Microsoft spend that kind of money on mobile payment solutions. It is the place Microsoft's brand name and technology can play a role. By the same token, I would like to see EBay use the proceeds to beef up its Paypal for mobile payment. It is a battle ground where money and brand name make a difference.
I am a Skype user. Lately I am experimenting with Apple's Facetime on iPod and iPad. End users don't have a say in a big acquisition like this. We vote with our daily usage and, ultimately, our buying power. It is good to have alternatives for an end user like me. And I like the alternatives I have seen so far.
This purchase is not for VoIP (Voice over IP) technology as Microsoft has that technology already, and VoIP is not worth that much money. I wonder Microsoft will actively promote Skype on Windows Mobile. Mobile telecom operators are already antagonized by Skype. Skype loaded Windows Mobile will automatically take itself out of the A-list from many mobile operators. In the office, users who use Skype are probably not paying customers, though most of them pay for other Microsoft products. At home, there may be some opportunity for Microsoft. I hope Microsoft will keep the application simple. Product integration based on the buzz word "synergy" will only bring confusion to end users. Will MSN Messenger be on the chop board? I hope not yet fear so.
Skype's shareholders are big winners. Among them, EBay owns thirty percent of Skype, and can finally conclude its chapter on Skype. I would like to see Microsoft spend that kind of money on mobile payment solutions. It is the place Microsoft's brand name and technology can play a role. By the same token, I would like to see EBay use the proceeds to beef up its Paypal for mobile payment. It is a battle ground where money and brand name make a difference.
I am a Skype user. Lately I am experimenting with Apple's Facetime on iPod and iPad. End users don't have a say in a big acquisition like this. We vote with our daily usage and, ultimately, our buying power. It is good to have alternatives for an end user like me. And I like the alternatives I have seen so far.
