Five reasons why Microsoft had to buy Skype
When Microsoft bought Skype, its main goal was to increase its tools for teamwork and communications in businesses. Back then, Lync was Microsoft's go-to for unified communications, letting businesses use VoIP, instant messaging, and video calling. Acquiring Skype added more features, a larger user base, and an opportunity to better blend these tools into its business offerings.
By merging Skype's strengths in both consumer and business communications with Lync's enterprise capabilities, Microsoft aimed to go head-to-head with rivals like Google and Apple, who had their own collaboration tools. Skype Connect played a big role here, as it enabled businesses to link Skype with their existing PBX systems, making it easier to connect traditional phone lines to modern VoIP services.
This acquisition helped Microsoft push further into cloud-based collaboration solutions, which became a key part of its Office 365 and Microsoft Teams plans. Skype set the stage for these connections, making the acquisition an important step for Microsoft to stay competitive in the business and communications sectors.
Why Microsoft had to buy Skype: five key reasons
At first glance, Microsoft's $8.500 billion purchase of Skype might seem like a lot of money, but the benefits of this deal far outweigh the cost. Here are five compelling reasons why this was a smart move for Microsoft:
1. Promote communication tools
Skype’s robust communication platform, with millions of users, gave Microsoft a great way to improve its existing services. By incorporating Skype into its lineup, especially with products like Office 365 and Teams, communication and teamwork became much easier, making it useful for both personal and business needs.
2. Add to user base
When Microsoft acquired Skype, it came with a huge global base of active users. This deal allowed Microsoft to expand its influence in the communications market and reach more people. It also opened the door to promote other Microsoft products to Skype users.
3. Improve cloud services
The technology and setup behind Skype fit perfectly with Microsoft’s cloud plans. By connecting Skype to Azure, Microsoft could provide better cloud communication services, improving the overall user experience. This also helped Microsoft stand out more in the competitive cloud services market.
4. Stay competitive
Buying Skype was a smart move to keep up with major tech companies like Google and Apple, which were also dipping their toes into communications technologies. With Skype under its belt, Microsoft secured a strong position in this space, making it difficult for its rivals to get ahead.
5. Promote innovation and integration
Skype’s cutting-edge features, such as video calling and instant messaging, paired well with Microsoft’s existing products. By blending Skype’s technology into its lineup, Microsoft could create new features and services, making the overall offering more valuable to users. This combination fostered innovation and allowed Microsoft to expand its communication tools.
Additionally, Microsoft aimed to improve Bing’s visibility and user engagement through Skype’s large audience of over 660 million registered users and 170 million active monthly users at the time. This provided an incredible opportunity to use this audience to increase Bing’s reach.
The plan was to create seamless connections between Bing and Skype, such as allowing users to search directly within Skype, get suggestions during conversations, or integrate Bing features directly into the Skype interface. Microsoft wanted Bing to be the first choice for searches linked to discussions or shared content on Skype.
A direct link between Bing and Skype made sense. For example:
– Search within chats: Users could search for content or links without leaving their conversation.
– Contextual suggestions: Bing could offer search results during chats, making it more natural to find information while communicating.
– Ad placements: Using user activity, Microsoft may display ads on Skype or in search results.
These strategies were aimed at capturing user attention within the Skype platform and driving traffic to Bing, taking on stronger search competitors like Google. While the execution of this idea varied over the years, with Bing still trying to challenge Google, Skype was a promising way to help Bing gain ground and better connect Microsoft’s search and cloud services.
How did the acquisition help Microsoft compete with other tech giants?
The acquisition of Skype was a strategic move to remain competitive with other tech giants like Google and Apple, who were also investing heavily in communications technologies. By acquiring Skype, Microsoft ensured that it had a strong presence in the communications space, preventing its rivals from gaining an advantage.
How did Skype's user base benefit Microsoft?
Skype had a huge global user base, which allowed Microsoft to leverage this extensive network, expanding its reach and influence in the communications market. It also provided the opportunity to cross-sell other Microsoft products and services to Skype users.
What role did cloud services play in the acquisition?
Skype’s technology and infrastructure were a perfect fit for Microsoft’s cloud strategy. By integrating Skype with Azure, Microsoft could offer enhanced cloud-based communication services, improving the overall user experience and positioning Microsoft as a stronger competitor in the cloud services market.
Why did Microsoft decide to buy Skype?
Microsoft bought Skype to strengthen its communications tools, expand its user base, improve its cloud services, remain competitive with rivals and foster innovation by integrating with its existing products.
