Yesterday, Microsoft announced that it was going to buy Skype for a cool $8.5 billion dollars.
Details of the Notice of Possible Acquisition
First things first: Microsoft hasn't purchased Skype yet.
Microsoft announced the deal in a press release that was followed with a disclaimer as long as the press release (which is standard corporate practice – if ridiculous).
But, if the deal does go through, $8.5 billion dollars is a lot of money to spend on a company that doesn't make any.
Yahoo! Finance has a good take:
In 2010, Skype had revenues of $860 million and posted a net loss of roughly $7 million.
Why would Microsoft dole out nearly $10 billion -- or ten times revenues -- for a company that makes zero profit?
The Guardian sees more disadvantages than benefits.
On the Skype message boards, there's been a knee-jerk reaction to the news: "Microsoft is bad! Microsoft is bad! Skype is doomed! I'm leaving Skype."
Enough summary. Let's get to the important questions:
How will Microsoft buying Skype affect you, the VoIP consumer? How will it affect VoIP, in general?
1. Microsoft could completely change the mobile market
Ars Technica explained one way that the Skype-Microsoft deal could change the future of VoIP, telephony, and telecommunications. What if:
Microsoft integrated Skype into Windows Phone to provide Google Voice-like services to a global market, with free calling to existing Skype and Messenger users and cheap international calling[?]
That's an important speculation. Microsoft buying Skype will probably lower phone service prices in general.
Just the possibility of the above statement, for one. Because industry trends become industry trends when someone gets afraid of being left in the dust.
Cell phone providers no longer offer unlimited data plans because too many people were using the Internet. Once one major carrier stopped offering unlimited data, all the others followed suit.
Most residential VoIP providers now offer a certain number of free international calls or free international minutes. Someone else started it and everyone one else copied them.
The majority of providers in our business comparison table have the same prices - $20 to $30 bucks per user.
So, this deal might wreak havoc on the profit margins of cellular and mobile carriers. It also might depress VoIP prices, too, especially if Skype is bundled with Office or some other Windows software, because of the business computing market that Microsoft has cornered.
2. VoIP just got more popular
Whenever a tech concept in some way related to VoIP makes national news, we get a traffic spike. I'm sure that most VoIP providers have seen an increase in visits, too.
I hope they don't sit on it. Some VoIP company needs to make a play on this development.
For example, domain registrar NameCheap.com managed to generate some serious buzz and (probably) some serious profits when they denounced GoDaddy CEO Bob Parsons' recorded elephant hunt.
Tenuous as this comparison is, why doesn't a VoIP provider do the same thing?
Claim you won't be bought out (and then don't get bought out). Offer a free SkypeIn/SkypeOut number port. Offer free landline calls or access to a softphone for free.
3. Possible Skype Exodus!?!?
Skype has 170 million subscribers for a reason: Skype is easy to use and free.
Skype is also growing. Skype benefited from video call and VoIP pushes of Apple and Google, respectively. (Read about it here. The author was part of the VC group that bought Skype from eBay).
Now that Skype is on the other side of the equation, they're the one doing the moving and shaking, will Skype start to lose users?
If nothing changes, then, no, Skype won't lose users.
But if Microsoft tries to make money off Skype (which, remember, is running at a loss), that could change things.
Ars Technica's idea is a good one. Skype could go the magicJack route and take ads to the next level. Might Skype charge a small fee for each user - maybe to remove those ads, as Microsoft does/did for premium Windows Live Hotmail?
I had more ideas than these but they were rather silly (Microsoft, you may pay me for them). But I think this is the crux of the issue:
How is Microsoft going to make money off Skype? One day later and I still have no idea.
I know you were all worried.