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Microsoft Acquires Skype For A Staggering Amount of $8.5 Billion

According to WSJ, Microsoft has announced the acquisition of Skype, a Luxemburg based company founded in the year 2003 for a staggering amount of 8.5 Billion USD. The main purpose of this deal is to integrate the VoIP services of Skype used by millions around the world with Microsoft's famous products like Xbox, Kinect and Windows Phone.

Microsoft Buys Skype
Microsoft's CEO Steve BallmerĀ said in a statement while announcing the deal:

Skype is a phenomenal service that is loved by millions of people around the world... 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.

He also mentioned that his team will continue to invest in and support Skype clients on non-Microsoft platforms.

This isn't the first acquisition of Skype, it was first sold for a relative bargain at $2.5B to eBay in 2005, eBay in turn sold it to Silver Lake in 2009 at an overall valuation of $2.75B and now Redmond is concluding the proceedings by tripling the earlier amounts and offering Skype a permanent home. A new Microsoft Skype Division will now be established to accommodate resources from Skype, current Skype CEO Tony Bates will be heading the division and will report directly to Ballmer.

Skype deal is so far the biggest acquisition in the 36-year history of Microsoft, a company that traditionally shied away from many large deals in the past. It seems Microsoft is gearing up against Apple's FaceTime and Google's Voice Call to provide a better services to its customers in its upcoming WP7 devices. We'll have to wait and see how this deal elevates Microsoft's potion in the software industry but no doubt it looks a good move from Microsoft. [Image Credit: WinRumors]

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