Microsoft Buys Skype for $8.5 Billion

Microsoft buys Skype for $8.5 billion

Just a few days ago, it was reported that Google and Facebook were interested in partnering with, and even potentially buying VoIP company Skype. Now, however, Microsoft has announced that it is buying the company for $8.56 billion in cash.

This is the second time Skype has been bought out; after being started in 2003, eBay bought the company in 205 for $3.1 billion. Last year, the company had revenue of $860 million, on which it posted an operating profit of $264 million. Still, overall, it had suffered a $7 million loss and has a long-term debt of $686 million.

In 2009, eBay sold the majority of its stock in the company for $1.9 billion.

This is Microsoft’s biggest purchase ever, which makes the acquisition a bit surprising. Microsoft tends to buy smaller, easier-to-manage organizations.

Interestingly, though, Microsoft’s own software does have considerable overlap with Skype’s. Windlows Live Messenger offers free instant messaging, as well as voice and video chat – and it boasts around 330 million active users each month. It makes sense that they’d want to acquire something that has fewer users, in order to boost signups and potential ad revenue – Skype currently has about 124 active users each month.

Do you use Skype? Do you think this will change the way the service is presented?


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Categories: Deals and Finances | Gadgets and Gizmos

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