Microsoft buys Skype for US$8.5 billion

Microsoft buys Skype for US$8.5 billion

Summary: US software giant Microsoft will buy internet phone service company Skype for US$8.5 billion (AU$7.9 billion), the companies have announced.

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US software giant Microsoft will buy internet phone service company Skype for US$8.5 billion (AU$7.9 billion), the companies have announced.

"Skype is a phenomenal service that is loved by millions of people around the world," Microsoft chief executive Steve Ballmer said in a statement.

"Together we will create the future of real-time communications so people can easily stay connected to family, friends, clients and colleagues anywhere in the world."

Microsoft said Skype would become a new business division within Microsoft, and that Skype CEO Tony Bates would assume the title of president of the Microsoft Skype Division, reporting directly to Ballmer.

According to ZDNet Australia sister site CNET, Microsoft is set to make the most of its hefty purchase and will integrate Skype with a broad range of its products including Xbox and Xbox Live, Kinect, Windows Phone, Lync and Outlook.

Microsoft Australia's managing director Pip Marlow stayed up late to tweet the good news.

"Welcome to the family Skype!", she tweeted.

Microsoft's US$8.5 billion buyout of the internet telephony company trumps earlier speculation that pegged the value of the deal at an already staggering US$7 billion.

Topics: Microsoft, Legal, Unified Comms

Luke Hopewell

About Luke Hopewell

A fresh recruit onto the tech journalism battlefield, Luke Hopewell is eager to see some action. After a tour of duty in the belly of the Telstra beast, he is keen to report big stories on the enterprise beat. Drawing on past experience in radio, print and magazine, he plans to ask all the tough questions you want answered.

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  • The beauty of Skype was that it was a cross-platform application: Linux, Mac and M$. I was just on the point of dropping my phone line in favor of Skype, and now I have to sit back and wait to see if Microshaft are going to make that transition unprofitable.

    Skype people: You got it wrong. You should have kept your product in private hands and only licensed those parts of the software that Microshaft needed.

    Now I have to go and find a non-M$ replacement for Skype :(
    Treknology