Update: Microsoft agrees to buy Skype for $8.5 billion
CEOs Steve Ballmer and Tony Bates will host a press conference later Tuesday to give details (video below)
IDG News Service - Microsoft has agreed to buy Skype for $8.5 billion, the companies announced Tuesday.
The companies' CEOs, Steve Ballmer and Tony Bates, will host a press conference later Tuesday to give details of the acquisition.
The boards of both companies have agreed to the deal, which will see Bates reporting directly to Ballmer as president of the Microsoft Skype division, illustrating the importance of the deal to the company.
Once the merger is complete, Microsoft plans to add Skype support to its Xbox and Kinect gaming devices and Windows Phone mobile operating system, and connect Skype users with its own Lync, Outlook and Xbox Live communications services.
Over the last week, the voice and video communications company had been rumored to be discussing an acquisition or partnership with Cisco, Facebook and Google.
Founded by Niklas Zennström and Janus Friis, Skype was bought by eBay in 2005. After that company failed to figure out how to integrate it with its online auction business, it sold a majority stake to an investment consortium including its founders and Silver Lake in 2009.
Skype made a name for itself offering free voice calls from PC to PC, charging to connect calls between PCs and the public telephone network. Later it added video chat and, more recently, software clients for smartphones.
Microsoft offered a similar PC-to-phone service for consumers under the Windows Live Call brand, and continues to offer PC-to-PC text, voice and video chat with its Windows Live Messenger service.
Skype and Microsoft also target businesses with their communications offerings. Microsoft has a server-based unified communications tool that connects PCs to a PBX to offer VoIP calling, instant messaging and videoconferencing.
Previously called Communications Server, it is now branded Lync, while Lync Online is a cloud-based service offering similar functionality.
Skype Connect, meanwhile, is a service that allows businesses to connect their PBX to Skype to handle incoming and outgoing calls. A management tool, Skype Manager, allows businesses to control call costs.
Peter Sayer covers open source software, European intellectual property legislation and general technology breaking news for IDG News Service. Send comments and news tips to Peter at email@example.com.
- Ballmer quits Microsoft board, cites NBA commitments
- In his own words: Best quotes of Steve Ballmer
- Update: Microsoft pulls crippling patch from Windows Update
- New Microsoft same as the old Microsoft
- Microsoft urges customers to uninstall 'Blue Screen of Death' update
- Windows 'Threshold' to go public within weeks
- Microsoft: Give IE another chance
- The news isn't good for Windows Phone
- Deja vu all over again: Windows 7 will be the new XP
- Microsoft postpones IE's Java blocking after IT complains
- Mission Critical Cloud Powers Freesat Website, Mobile App When subscription-free satellite TV service Freesat needed a scalable, cost-effective infrastructure it found the disaster recovery and security features it needed with Peer...
- Bring Your Own Device: From Security to Success Download this e-Book to learn best practices for executing a BYOD policy.
- Securing Mobile App Data - Comparing Containers and App Wrappers Analysts agree that Mobile Device Management (MDM) is not enough when it comes to securing app data. Although it remains a critical component...
- 3G/4G Digital Signage Guide Today, the widespread availability of 3G and 4G cellular or wireless broadband networks enables digital signage to be deployed virtually anywhere.
- Don't Believe the Hype: Not All Containers are Created Equal Hear executives discuss the 3 C's of Secure Mobility-content, credentials, and configurations-and learn the inherent security risks to your organization of using MDM...
- Navigating the New Wireless Landscape Thriving in the new wireless landscape View Now>> All Mobile/Wireless White Papers | Webcasts