Feeds

Microsoft poised to make biggest ever buy – Skype

P2P blabbernet seduces another sugar daddy

Build a business case: developing custom apps

Microsoft is close to buying VoIP service Skype for about $8.5bn.

An announcement could come as soon as today according to sources collared by the Wall Street Journal. But the paper cautioned that the deal was not final and may still fall through.

The deal would be Microsoft's biggest ever, costing in the region of $8.5bn including debts. Not that Microsoft is short of cash – it made $5.2bn in profits last quarter and has more than $50bn in the bank or in short-term investments.

Presumably the deal is seen as a way to bolster Microsoft's lacklustre online and mobile businesses. Despite massive marketing spending, Bing is still struggling to find a place in people's hearts, and Windows Mobile also finds itself in third place.

Skype claims 23m concurrent users at busiest times and 124m people a month using the service in some form: how many pay for the privilege is less clear. However the company's costs are low as most of the resources - bandwidth, processing power - used to handle calls are provided by users (or the networks they are on) rather than by Skype itself.

Despite, or perhaps because of, its cunning parasitic P2P architecture, Skype has been the unloved ginger step child of the internet. eBay was forced to write off billions of dollars after buying the service and failing to find any way to integrate it with its core auction business.

The online tat bazaar paid $3bn for Skype before offloading it to Silver Lake Partners and other private investors for $1.9bn

That transaction also settled a patent dispute between company founders Niklas Zennström and Janus Friis and eBay.

Most recently, rumours were that Google or Facebook could be interested – here's Matt Asay's explanation of why they should walk away, which is well worth a read.

A Microsoft spokeswoman told us: "Microsoft does not comment on rumour or speculation." ®

The essential guide to IT transformation

More from The Register

next story
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
So, Apple won't sell cheap kit? Prepare the iOS garden wall WRECKING BALL
It can throw the low cost race if it looks to the cloud
Time Warner Cable customers SQUEAL as US network goes offline
A rude awakening: North Americans greeted with outage drama
Shoot-em-up: Sony Online Entertainment hit by 'large scale DDoS attack'
Games disrupted as firm struggles to control network
BT customers face broadband and landline price hikes
Poor punters won't be affected, telecoms giant claims
Netflix swallows yet another bitter pill, inks peering deal with TWC
Net neutrality crusader once again pays up for priority access
prev story

Whitepapers

Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Backing up distributed data
Eliminating the redundant use of bandwidth and storage capacity and application consolidation in the modern data center.
The essential guide to IT transformation
ServiceNow discusses three IT transformations that can help CIOs automate IT services to transform IT and the enterprise
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.