Saturday, May 14, 2011

Largest Technology Buyout – Microsoft Purchases Skype!

Growth in the technology sector is becoming major threat to industry giants. Recent $8.5 billion Skype buyout deal with Microsoft is one example of how industry giants are trying to do things to keep up with the faster growing technology companies.

On 9th May, this largest buyout agreement was finalized. This acquisition will help Microsoft enter in business lines such as calling to play, catch-up in mobile and web advertising.
Microsoft realizes that the market for online advertising and mobile software is growing with crazy pace and this biggest Internet takeover in the recent history, will also bring Microsoft in direct competition with Google in online advertising and Apple Inc. in mobile software.

The plan to connect Skype’s 170 million active users, to Microsoft’s Outlook e-mail, Xbox game console, Windows mobile phones and corporate-phone software will truly shake the technology market place!

Skype was founded in 2003 by Niklas Zennstrom and Janus Friis. The founders sold the company for $2.6 billion in 2005 to San Jose, California-based EBay Inc., which in turn sold off most of its stake four years later. Current investors include EBay, Silver Lake and Andreessen Horowitz.

We need to watch how Google takes this deal in the near future!


Syed Mairaj said...

Skype is one of the most used softwares in call centers, whose business is growing tremendously in both in-bound as well as out-bound. I think Microsoft made a very profitable decision, however I have a bit reservation as well that softwares running by small companies are managed well and after the acquisition usually the charm of that software/applications start reducing. For example Orkut used to be the market leader as they had the first mover advantage in Social Networking back in 2005 but after it was acquired by Google it is now no where. Microsoft is also trying to acquire Facebook but the owner is refusing continuously might be to avoid the same danger of becoming obsolete.

Atiq said...

Skype, as they said, made use of the p2p network and hence uses the users machines and slip accounts. On acquisition, may be due to technological change, the power of skype would reduce and hence their is possibility of Microsoft branding over shadowing the popularity of skype.... But indeed it is a very good news for future developments in this area....