For the past week or so, rumors have been swirling around Skype, the Internet telephony company. Reuters has reported that the company has been in talks with both Facebook and Google, either for a partnership or for an outright acquisition. And if my sources are right, we will find out more details very soon.
How soon? People familiar with Skype indicate that some kind of news is forthcoming later this week, perhaps as soon as Monday. At present, corporate attorneys and other senior managers are burning the midnight oil this weekend, ahead of some kind of announcement. A Skype person replied to my email query by saying, “Thanks for reaching out – as a matter of practice – Skype does not comment on rumor or speculation.”
Sources also say that Microsoft has entered the mix and is interested in either partnering with, acquiring or investing in Skype. While they are late entrants to this game, Microsoft’s interest makes sense for several reasons:
- Skype would givemMicrosoft a big boost in the hotly contested enterprise collaboration market places, thanks to Skype’s voice, video and sharing capabilities. It would be particularly useful for competing against Cisco and Google, two of its main rivals in the collaboration business.
- It would give them a must-have application/service that can help with the adoption of the future versions of Windows Mobile operating system.
- it would give Microsoft an outside chance of working with carriers, many of them looking to partner with Skype as they start to transition to LTE-based networks.
What is my take on all the rumors? First of all, this is not the first time we have heard them. While I clearly see value in these companies partnering with Skype, an acquisition doesn’t make much sense. But an investment from one of the three could give Skype the cash cushion as it waits out for its initial public offering, and could also be a way to buy out an antsy investor. And while a partnership would make sense for Facebook, it doesn’t need to acquire Skype — I’ve heard the two companies are about to make some kind of joint product announcement soon.
Photo of Microsoft Campus courtesy of Flickr User, Wonderlane under Creative Commons license.
Google buys Skype and we get an instant VoIP solution, then hopefully they’ll pour a bit of money into it to make it more reliable.
Nope. Google buys Skype and it disappears like Gizmo did. v_v
I hope I am wrong.
There is every chance that any of these three suitors could potentially bury and the brand equity and culture of the one and only great telco alternative. Skype is the “other” beef, the counterbalance to the telco hegemony. If Skype is swallowed to be mismanaged by a Microsoft, falls into the bottom pit of the Googleplex never to emerge, or to be dismembered and dissected by the maverick facebook (the privacy nightmare has only just begun), we shall all be the poorer.
Hey, I am sympathetic to the notion of ‘harvesting of investment value’, but the principals of Skype are already fabulously wealthy – at some point, the notion of industry and sector stewardship must be considered, and how, pray tell, is operating a multibillion dollar VOIP and collaboration venture that throws off hundreds of millions in profits a bad thing. To simple throw the business to well known “brain and innovation black-holes”, is borderline irresponsible.
Well said.
Of the three, I’d root for Google, but then Google did just kill Gizmo…
They probably should not have bought Gizmo in the first place. It was well intentioned to build a standards based VoIP client, but nobody used it, and the call quality was generally not very good.
If Google bought Skype and made it more standards compliant, and integrated it with Google Voice, that could be pretty interesting. Google has been pushing development tools (App Engine, etc), and has a great platform.
On the other hand, mergers between big companies rarely work out very well, so I’d rather see Skype remain independent.
Hmm:
Exchange, integrate it as personal conferencing: Task oriented messaging, today’s unified messaging seems more like a relic of the 90’s, it’s like programing with global variables. To get the data flow under control we need to go down to task level.
Mobile OS: Tiles show already that MS is thinking about task orientation. Allow developers to take advantage of it as differentiator to the rest.
FB: Deepen partnership, allow different task on FB to integrate with it, don’t take FB mail as the enemy to exchange. Take it as a personal task, extend it with professional tasks ….
Taking a look at the people who bought into Skype, a quick sale doesn’t seem in character. If I recall correctly, the Canada Pension Plan Investment Board was one of the bigger buyers through the fund run by SilverLake. CPPIB isn’t typically a buy and quick sale profile. It appeared at the time of the purchase that this was an investment that viewed Skype as a form of utility that generally blended with other parts of the investment portfolio.
I’m not saying that a quick buck isn’t what a government pension plan is looking for (especially when there’s pressure to show good returns in a weak market), but the pressure for a quick return doesn’t seem to be apparent right now.
I’d put my money on some partnerships that would bulk up the reserves and allow progress towards and IPO.
I don’t want Facebook raping Skype on the privacy side, handing your Skype credentials over to scabby app developers as they are so desperate to do with real phone numbers, etc.
Google buying it seems like a mistake too … they don’t support anything, where are millions of Skype users going to go to when they have a problem or feedback?
MS also seems like a bad idea .. some of their non-Windows software is pretty meh, what would they do with all the non-Windows versions of Skype?
Having to choose between no privacy, no support, or single-platform is a tough decision cause they’re all such great options.
“Skype would givemMicrosoft a big boost in the hotly contested enterprise collaboration market places…”
Microsoft has enough and even better products in this area with exchange, lync etc. It would be more about the brand and user base as it would be about the technology. Skype is a consumer brand and their features focus on that, nevertheless it wouldn’t hurt to own it.
“It would give them a must-have application/service that can help with the adoption of the future versions of Windows Mobile operating system.”
Skype for WP7 is coming this fall with the Mango Update. Pre-Release versions have been already shown publicly, you don’t have to own Skype to pull that one either …
Maybe a Lync-to-Skype gateway so Lync and Skype users can call each other without going through PSTN. (PIC has long allowed Lync users to IM with AIM, Yahoo and Messenger users.)
Eventhough I know they will totally mismanage it as a product, only Microsoft has the pull with the carriers to get Skype on mobile handsets.
Carriers hate all VoIP more than anything, the very idea of their cash cow ( call minutes and SMS ) being usurped by efficient data based voice communication fills them them rage.
…but if Ballmer promises the carriers he will intentionally make Skype *less* efficient, cripple it for any other mobile OS besides Windows 7, quadrupedal how much data it chews up, they be more open to it being on mobile phones.
Small typo: “givemMicrosoft” – extra
It’s called Windows Phone. Not Windows Mobile. #really?
#McPointless
If Microsoft partners with or buys Skype, it should be for the pro-sumer side, not enterprise UC. Skype’s protocol is never going to pass any of the big-corp compliance requirements and besides Microsoft has Lync for that market.
Embedding Skype as standard in IE9 – and supporting it in hotmail – that makes more sense. Or possibly some Azure cloud angle….
But given the lack of uptake from Facetime (and Apples reneging on releasing the protocol) I’d say they should be interested.
Skype is redefining VOIP and not just for individuals as pointed out. Very strategic player on many levels right now. Big horns will lock over this action if true. Skype impacts so many different vendors in terms of strategy and markets. Cisco? Adobe? Apple? IBM? Facebook? Google? HP? Telcos?
I wouldn’t want any of these companies to buy Skype, but I would like to see some kind of interoperability deal like they made with AIM from Google. Whatever happens, I’d still like to see this happen, too.
Why wouldn’t it be good if Google bought it, and opened it up and interoperate it with SIP protocol for VOIP and HD video-chat.
You can already do SIP trunking with Skype, using Skype Connect.
I assumed Facebook was buying Skype, but it would be a smart move for Microsoft to gobble up the company. In any event it seems like Facebook is in the middle of buying something big.
OK. Founders sold Skype to Ebay. Ebay sold to Silver Lake. SL will sell to MSFT. But W H O will MSFT sell it to??? They are not in the company selling business. In other words this will be the end of Skype. None of the owners have figured out yet how to make money from Skype, MSFT will??
Microsoft is already very well established in the enterprise communications and collaboration world. They’ve had messaging (IM, email) and voice (VOIP, phone integration) for years. Latest brand is Microsoft Lync.
Skype is a consumer play.
Skype is not limited to a single market. Personally, I dropped most of the online conferencing tools once Skype introduced screen sharing (albeit the UI needs a lot of work). I see Skype being both a consumer and business play. The game is on. Looking forward to the week ahead as we learn more about partnerships. The delicate dance will be over privacy and access.
As someone who loosely competes with Skype, I would love to see them get acquired. Skype has done a great job since breaking with Ebay. Let them merge with some behemoth who wants to muck up Skype, and treat it as a secondary or tertiary business for them.
Changes of technology, widened choices!
Skype may be an SMB play but it isn’t a Enterprise play. Microsoft is already creating a steady flow of pay services with Office 365 and Lync Online… soon SIP trunking will be an available offering providing video, voice, and UM within a complete online offering.
Where this could provide a very interesting culmination is Skype with Live services and Facebook… that would be a thing of beauty.
This is all so exciting, Skype technology combined with a Web Business Network Application and Science. The network application for this evolution is already available to be developped. I want to inspire such group combination, Microsoft and Skype, Facebook and Skype,Google and Skype; any of these combinations and the adoption of my SupraMinds application will enhance evolution mastersminds and create SupraMind successors that the universe needs to evolve. Its time to shout out to the world. I am here…
You are right, it is a rumour. It makes no sense for facebook to acquire skype.
Microsoft is probably behaving defensively. It doesn’t want Google to acquire Skype, as Google would then show no interest in porting Skype to Windows Phone.
It’s ironic that Microsoft hasn’t been capable of getting any VoIP services operating on Windows Phone, because Windows Phone 7 lacks the required internet ‘sockets’ for it to work. Windows Phone 7 can only work with HTTP, which is also the reason that real-time multi-player gaming does not work on Windows Phone 7.
the new wp7 update ‘wp7.5’ is going to have all those features…. voip etc, don’t worry….. wp7 is just in it’s first version and it’s super cool!
Out of the 3 I would really prefer Microsoft to get it. If not, I would rather have Facebook getting it. Google just sucks eggs and would ruin Skype. My company would find a new provider of Google was to get it.
This is indeed BIG news. Very bold but brilliant move by Microsoft if true. Didn’t they buy TellMe too?
Google has google voice and microsoft has? ?? Microsoft could definitely boost business with Skype.