Why Microsoft really bought Skype

The war of the mobile and cloud giants has taken another step up in terms of ferocity as Microsoft announced the acquisition of Skype.

As we all know, who would buy Skype has been a topic of contention for quite some time with such suitors as Facebook, Google and even Ebay mentioned frequently, but as of May 10th we now know the victor is Microsoft. How this will alter the market has been widely debated over the last few days, but I wanted to add my ten cents on how I believe this will affect the market, why Microsoft and Skype are a good marriage and why I believe Microsoft really bought Skype.

How will this affect the market?

As I have said I firmly believe, this acquisition is a further stage in the war of the giants with Microsoft, Apple, Google and a few others all vying to become the technology giant. Clearly Microsoft have more than a passing interest in Skype for mobiles as it is the dominant force in the market and makes Face Time from Apple pale into insignificance.

The strength of this mobile offering is made clear by the fact that Microsoft have pledged to continue developing Skype for products beyond their own remit. Will this boost sales of Windows 7 mobiles? It’s hard to say but it will definitely give Microsoft a new and firm foothold in the mobile market.

Are Microsoft and Skype a good marriage

On the surface it has to be said Microsoft and Skype on first inspection appear an annulment waiting to happen however on closer inspection many analysts have agreed with Dean Bubley from Disruptive Analysis that “this actually looks like a near-perfect fit for Skype”.

Why- well i would argue whoever bought Skype had to be able to afford the 8.5billion price tag for a company that on paper makes very little profit, they would need to have a knowledge of the PC and mobile world whilst also needing a foothold in both the business to business and business to consumer markets.

Microsoft ticks all these boxes. Finally as Horace Deidu who runs analyst company Asymco so eloquently put it “Voice is the next frontier both in IP-based communications and in user interfaces” and I would argue the next frontier for the war of the giants and given that Skype currently reigns supreme in the world of VOIP Microsoft seem to have won at least the battle.

This takes us on to why Microsoft really bought Skype. Well the reasons above may seem compelling enough let us not forget that Skype has over 170 million subscribers and dedicated followers to whom Microsoft can now open their doors. Only time will tell if Microsoft have the innovation and open mindedness to tap this huge and willing market but my bet is they will give it a very good go!!!

Essentially the announcement of this deal brings Microsoft firmly back into the war of the mobile devices no longer can we say its Apple versus Google versus RIM, Microsoft are back in the game in a big way and it would seem they are here to stay.

It also proves just how much Microsoft are willing to invest to stay in this very lucrative market, in turn highlighting how important this market will become for each of us in the world of IT. Google and Apple challenged Microsoft to step up and be counted and with this purchase they have done just that. Who will win out? Your guess is as good as mine!

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David Akka is Managing Director at Magic Software Enterprises UK. David is a successful executive manager with a proven track record as a general manager with a strong background in sales, marketing, business development and operations. Past experience in technology and service delivery include both UK and European responsibilities.