So Microsoft has officially spent $8.5 billion on Skype and announced that the deal closed today. This is another "Hotmail" type acquisition in that it didn't seem to need the technology. All it gained was users. Or did it? With Skype, Microsoft added about 50 patents covering networking, speech recognition, user interface, too. Hmm.
I'm not saying Microsoft absolutely needs these patents for its war on Android, Chrome and Linux -- it signed one of its most significant deals prior to buying Skype (HTC) as well as launching two lawsuits (Motorola and Barnes & Noble). But it certainly announced a whole bunch of those agreements since March, when it went public with the Skype deal. It has gone gangbusters with deals in the past few weeks, after it completed regulatory approval in the U.S. and Europe. (Acer and Viewsonic, Casio, Quanta Computer, Samsung -- though I've questioned how much the Samsung license renewal deal was really about Android per se).
Despite Microsoft's broad patent portfolio from technologies it actually developed, the company is hungry for more patents. It is part of a consortium trying to buy 6,000 patents and patent applications from Nortel. These span wireless, wireless 4G, data networking, optical, voice, Internet, service provider, semiconductors, etc. The Open Invention Network is trying to fight this sale -- or at least limit it so that these patents can only be used in a defensive manner, a la the settlement made when a consortium including Microsoft tried to buy Novell's patents. For years, Microsoft wasn't the bad guy when it came to patent trolls. With its deep pockets, it was far more often the target of lawsuits. But with its licensing attack on Android, Microsoft has become the master of the patent troll playbook, no longer just the victim.
Here are the promises Microsoft made about Skype at the acquisition press conference.
It will be curious to watch what Microsoft will do with Skype. Many assurances have been made by Steve Ballmer and former Skype CEO, Tony Bates, that Skype will not abandon its Android and Linux users. There is some reason to be hopeful on that count. Since Skype learned it would become part of Microsoft it worked feverishly to fix the biggest complaint against it -- a lack of support for video calls on most Android devices. In August and September, Skype added a slew of devices now supported for video calls, including the most popular HTC, Samsung and Motorola Android models as well as the Galaxy Tab, some Sony Ericsson Xperia models, etc. (List of supported devices here and here.)
But as of Monday, Skype is now part of Microsoft ... so we'll see ...
I'm also curiously waiting for news on how Skype will be integrated into with Lync, Outlook, Xbox Live and other communities, as promised in March.
Microsoft didn't seem to really need Skype to bring these capabilities into its products. It already has its own enterprise VoIP/Web conferencing/instant messaging/technology: Lync and has promised a big Lync/Skype integration, though the details on that are still vague. Lync is still sadly lagging in its mobile support. Lync was launched about a year ago in November with promises of integration with Windows Phone 7 and Xbox Kinnect. Now, Microsoft promises that all promised Lync mobile clients will be out by year's end. How does Skype fit in? Will it be an additional client or will a Skype client also include secure access to enterprise Lync services? We'll see.
Meanwhile, let's just point out that Microsoft already had, in bits and pieces, all the technology that Skype brings it. It had its own consumer IM/Internet video chat/Facebook chat... MSN Messenger. It already has not one, but two hosted Web conferencing services ... LiveMeeting and LyncOnline. Obviously, it also has Lync, which isn't a new product either, and was sold for years prior as Office Communications Server.
Microsoft promised to integrate Skype with lots of wares.
It has taken more than a decade for Microsoft to capitalize on its purchase of Hotmail, way back in 1997 -- and the jury is still out on that one. Thanks to Hotmail, Microsoft can claim astronomical numbers of Windows Live users ... 500 million active users a month, the company recently reported. Microsoft may have finally figured out what to do with Windows Live via Windows 8 and WP7. I'd say Microsoft doesn't have a decade to capitalize on its Skype buy.