In a shocking report, The Wall Street Journal has confirmed that Microsoft has purchased Skype in a 8.5 billion dollar buyout. This deal gives Microsoft complete ownership of Skype Technologies SA, and this buyout is one of Microsoft’s biggest purchases to date.

Skype has been a key player in the desktop and mobile space as one of the most popular VoIP services in existence. On iOS, Skype has always been a wonderful service for those wishing to make calls (both audio and video) over 3G and Wi-Fi.

“Microsoft Corp. is to close a deal to buy Internet phone company Skype Technologies SA for between $7 billion and $8 billion—the most aggressive move yet by Microsoft to play in the increasingly-converged worlds of communication, information and entertainment.

A deal could be announced as early as Tuesday, people familiar with the matter said, though they cautioned that negotiations aren’t yet final and a deal could still fall apart. Including Skype’s long-term debt, the total value of the deal is about $8.5 billion.]

Representatives for Microsoft and Skype declined to comment.”

What does this Microsoft deal mean for Skype on the iOS platform? No one really knows at this point. Skype has an incredibly popular app in the App Store, and it would be a huge shame to see such a useful service disappear into Microsoft’s proverbial ether.

The WSJ speculates,

“Skype could play a role in Microsoft’s effort to turn around its fortunes in the mobile-phone market, an area where it has lagged badly behind rivals Apple and Google. The company last year launched a new operating system for mobile phones known as Windows Phone 7 that has been well reviewed by technology critics but hasn’t yet meaningfully improved Microsoft’s market share.”

Microsoft will most likely integrate Skype’s technology into Windows and Windows Phone 7. Apple has its own proprietary video calling technology with FaceTime, and Microsoft will be playing catch-up with Skype integration.

GigaOM outlines some of the benefits of this purchase for Microsoft,

  • Skype gives Microsoft a  boost in the enterprise collaboration market, thanks to Skype’s voice, video and sharing capabilities, especially when competing with Cisco and Google.
  • It gives Microsoft a working relationship with carriers, many of them looking to partner with Skype as they start to transition to LTE-based networks.
  • It would give them a must-have application/service that can help with the adoption of the future versions of Windows Mobile operating system

We want to keep our hopes up, but it’s unlikely that support for Skype on iOS will continue when Microsoft holds the reigns.

How do you feel about Microsoft and Skype moving in together? Do you think Skype will eventually be abandoned on iOS and the Mac?

UPDATE: Microsoft has officially confirmed its acquisition of Skype. AppleInsider reports,

“Skype is a phenomenal service that is loved by millions of people around the world,” Microsoft Chief Executive Steve Ballmer said. “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.”

  • GarethDPhillips

    I think its nonsense to say that Microsoft wont support Skype in iOS. I’m sure they will continue to offer it cross platform, and may even use it to replace or improve their own live messenger product. The future is in cross platform products, and I’m sure Microsoft and Google are already demonstrating this, it’s apple who are slower on the uptake.

  • ramos96

    WOW!! (first btw, lmao)

  • C0ntr0l

    It’s funny for you to say that when apple was the first to bring FaceTime to mobile platform

    • GarethDPhillips

      I love facetime, but Apple brought it their devices only, not cross platform.

  • Shahzad

    Great..!!! Now skype will be crashing all the time…

    • Cameron

      Well only on iOS 😀

  • Not to happy about it but I can’t say I’ll stop using it. Only time will tell where Skype will go to. Maybe it will get better, I’m not a wp7 fan, ugly o/s.

  • Cameron

    Microsoft aren’t like that and won’t ban Skype on iOS. I am sure the the app will carry on as usual (of course Skype on Windows Phone 7 will be better but Apple would have done the same if they owned Skype [Actually they would ban it for Microsoft]) Remember they are rival company not friends.

  • Filip Crvenkovic

    Taking Skype out of tha app store and disabling it on the iOS platform would be a VERY stupid strategic move on Microsoft’s end.

    Skype for iOS presents a multi-million (possibly even 100 million+) market, and not benefiting from this would be just outright dumb.

    This presents a new revenue stream for Microsoft (not that they need more money, but hey it’s business and people will be people (read: greedy)) and I hope that they’ll develop it significantly on all ends i.e. all platforms.

    The only thing I don’t see is this benefiting the user (which they jeavily claim in the statement). Microsoft has paid $8.5 billion(!!!) for a company that’s in debt and which will need even more investment in order to achieve the level of integration they are hoping for. The most obvious way of getting a ROI is to start charging for Skype’s basic functionality – which is free Skype to Skype.

    Hopefully, MS will be able to push Skype into enterprise which will take out some of the cost for us individual users.

  • I have to disagree with you Alex. I believe Microsoft will keep working on Skype for iOS, and other platforms such as Android. As a commenter noted above, it would be a terrible strategic decision for MSFT to discontinue support on competing platforms.

    Now I’m curious to see if MSFT is going to rebrand the company. I highly doubt it but with MSFT, you can never really tell. Skype is a very powerful brand, and I believe the right thing to do would be to leave it as a standalone brand. Only time will tell.

    In the meanwhile, I couldn’t really care less who buys Skype as long as my phone/video calls to France still work the same.

    • Interesting. I was just speculating, but it’s obvious how much Microsoft prides itself on cross-platform development (sarcasm). I feel like Microsoft will rebrand Skype and, not immediately, but eventually turn it into a Windows-only feature. After all, they need anything they can get to make their desktop and mobile platform appealing.

      Who knows, though. Only time will tell. 🙂

  • GarethDPhillips

    Why the Microsoft bashing on cross-platform dev? As this is an apple related blog, maybe you should look closer to home for an example of a company who are particularly bad at this?
    Many of Microsoft’s products (consumer and enterprise) are available on a variety of platforms. I dont see any sign of Facetime becoming cross platform and open.

  • Skype instant messaging as BBM equivalent on Windows Phone 7/Nokia? That would be all sorts of epic. Way to go Microsoft

  • Rodrigo

    Now skype for Mac will have it’s layout fixed! Yeah!

  • Jacksparrow

    This deal makes little sense. Prolly what happened was the telecos promised to pedal more win phones big time if Mr. Softee promises to put skype on a leash for them.

    Ma bell and her ugly step children can’t been seen purchasing it directly. Msft is notorious for these type of coordinated dirty deals just ask intel and dell.