In its largest purchase ever, Microsoft said Tuesday that it will purchase Skype SA for $8.5 billion.
Skype, the mega-popular Internet telephone and video chat service, gives Microsoft 170 million people in its user database, with users spending 207 billion minutes of voice and video airtime in 2010, Microsoft said in a statement.
“Skype has been a pioneer in creating rich, meaningful connections among friends, families and business colleagues globally,” the statement said. “Microsoft has a long-standing focus and investment in real-time communications across its various platforms, including Lync (which saw 30 percent revenue growth in Q3), Outlook, Messenger, Hotmail and Xbox LIVE.”
Skype will become a new business division of Microsoft, while bringing its services to Xbox, Kinect, Windows Phone and a variety of other Microsoft devices and services.
“Skype is a phenomenal service that is loved by millions of people around the world,” said Microsoft CEO Steve Ballmer, in the 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.”
Skype CEO Tony Bates will become president of the Microsoft Skype Division, reporting directly to Ballmer.
“Microsoft and Skype share the vision of bringing software innovation and products to our customers,” said Bates. “Together, we will be able to accelerate Skype’s plans to extend our global community and introduce new ways for everyone to communicate and collaborate.”
Skype was founded in 2003 and purchased by eBay in 2005 and then by another investment group in 2009. The majority of its users are in Europe, and country-to-country calling is its most popular service.