Microsoft’s Acquisition of Skype Is Finalized

After getting a green signal from the European commission earlier this month, Microsoft has finally finalized the acquisition of online audio and video communicating service Skype for $805 billion. The news of Microsoft’s acquisition of Skype first surfaced back in May but delayed because of multiple constraints.

In order to finalize the deal, Microsoft had to go through a regulatory approval in number of different markets of which Europe was the biggest one. Microsoft’s relation with European commission has never been on a stronger side as Microsoft faced a lot of trouble when it integrated Windows media player and Internet Explorer into its Windows operating system and was fined by European commission for antitrust behavior.

However, the European commission gave a green signal to Microsoft’s acquisition of Skype without any objection. On that occasion, Microsoft said that now their first priority would be to finalize this deal as soon as possible without any further delay. So, Microsoft has finally announced the official acquisition of Skype. Now, Skype has become the new business division within Microsoft and the CEO Tony Bates will take on the presidential role for that division.

It was in 2003, when Niklas Zennstrom and Janus Friis led the foundation for Skype. In 2005, eBay took over it, but failed to incorporate it into its business and eventually sold it in 2009 to an investment group conducted by Silver Lake.

This deal with Microsoft is certainly brought a massive profit for that investment group which is comprised of Index Ventures, Andreessen Horowitz and the Canada Pension Plan (CPP) Investment Board. The investment group purchased the Skype for $2.75 billion.

The acquisition of Skype has also brought some challenges for the Microsoft. The most obvious is the non-profitability of the Skype at the moment. If we look at the long-term perspective of this acquisition, the large user base, i.e. over 663 million of which 170 million users use the service on monthly basis and the steady growth certainly make this acquisition valuable at least for the company who know how to manage things.

Tony Bates while expressing his thoughts over the acquisition said, “Together, we will be able to accelerate Skype’s goal to reach 1 billion users daily.”

Enjoyed this article? Submit your email to receive daily news and updates.

***You must click confirmation link sent in email. If you don't see the email, check spam folder.

Filed in: News Tags: , , , ,

Leave a Reply

Submit Comment

© 2022 Tech Readers. Reproduction without explicit permission is prohibited. All Rights Reserved. XHTML / CSS Valid.