Microsoft buys Skype for a shit ton

[JUL3]

http://www.macworld.com.au/news/microsoft-buys-skype-for-8-5-billion-29708/

Microsoft has agreed to buy Skype for US$8.5 billion, the companies announced Tuesday.

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.

I thought this was interesting;

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.

Seems odd to me, being how Skype is non-profitable, how exactly do they intend to make money with this?

 

[Acepilotf14]

Skype is non-profitable,

Not anymore.

 

[Krynn72]

Seems odd to me, being how Skype is non-profitable, how exactly do they intend to make money with this?

Probably something to do with how 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.

 

[Robbo]

Or they're going to use it to make their current products better, like conference calling in Office and for whatever the hell people on XBL do. I assume that whatever they do their going to ruin it like MSN messenger so maybe I wont bother getting into skype.

 

[BabyHeadCrab]

Whelp... it already was costing money for smart phone / tablet users so... saw a buyout coming. **** it.

 

[ríomhaire]

As long as they don't start bringing in new charges for it this actually sounds pretty good.

 

[Hazar]

who says skype wasn't profitable? They make money from skype to landline calls as well as advertising I believe.

 

[Hectic Glenn]

Exactly. No one ever bought Skype credit before? What about Skype Premium which is a paid service to get group video calling? It certainly was not non-profit, Skype is a huge business. Not sure which business studies course you did but Microsoft paying $8.5 billion for a company which doesn't make an money? Heh. Also Skype was bought by Ebay in like 2000 or something from the original Luxembourgian developers, then some other investment group bought them a couple years later.

There were rumours about this last week but with Google or Yahoo in the shadows waiting to buy. I was kind of hoping Google would get it and use the Skype brand to push their Google Voice free calls to landlines. I'm a bit bummed out that Microsoft bought it...I have worrying images of Skype being bundled with 'Windows Live Essentials' and I'm trying to download Skype and Microsoft is like 'HERE HAVE MSN MESSENGER AND A BING SEARCH BAR TOO.' Then I wake up in a cold sweat.

 

[Escaep]

who says skype wasn't profitable? They make money from skype to landline calls as well as advertising I believe.

Its revenue rose 20 percent last year, to $860 million, and operating profit climbed to $264 million, though it had a net loss of $7 million after making its debt payments.

http://www.nytimes.com/2011/05/11/technology/11skype.html?pagewanted=2&_r=1&ref=business

In essence it is profitable in the sense of operating profit but they might still have a lot of debt to pay off (unless they have no debt this year.) Skype itself is hugely successful I am just curious into how they owe so much debt.

 

[Ennui]

I really hope Microsoft doesn't shit up Skype too bad. I'm afraid I'm going to login one day and it will have morphed into Windows Live Messenger.

 

[Sulkdodds]

My worry is that Skype's increasing ubiquity will be disrupted by Microsoft's platform-political desires.

 

[DEATHMASTER]

Sky.net

 

[Krynn72]

Whelp... it already was costing money for smart phone / tablet users so... saw a buyout coming. **** it.

Skype was free on my phone, as long as you didn't call other people's actual phones.

 

[GreatEmperor]

http://www.nytimes.com/2011/05/11/technology/11skype.html?pagewanted=2&_r=1&ref=business

In essence it is profitable in the sense of operating profit but they might still have a lot of debt to pay off (unless they have no debt this year.) Skype itself is hugely successful I am just curious into how they owe so much debt.

Im sure a lot of Microsofts cash went to buy up the debt too