About three weeks ago there was a simultaneous announcement by two big companies. Its two datelines were Redmond, Wash. and Luxembourg.
The Redmond part was easy. If there are any other big companies there, we don’t know about them. Redmond means Microsoft.
Luxembourg. A very small country, right? Oh, Microsoft bought Luxembourg!
Well, not exactly. We’re not sure Luxembourg is worth $8.5 billion. But Skype is based in Luxembourg.
You know, Skype. The company that lets us call each other for nothing. The one I mention at the end of these columns when I ask you to Skype lilimartini—that being my Skype identity.
I was an early adopter of Skype, when it started in 2003.
For the past while Skype has been owned by a bunch of investors led by Silver Lake. In the press release and in various news stories Skype is referred to as a communications company. Well, so is Verizon. So is Microsoft.
Why is Skype worth that much to Microsoft—billions more than others had been offering?
Because it will get Microsoft further into “the cloud” and into real-time connections than Microsoft has been, and might leap-frog Google’s latest expansions.
Accessibility…real-time video and voice…generates significant new business and revenue opportunities…extends Skype’s world-class brand…reach of its networked platform…enhances Microsoft’s existing portfolio of real-time communications products…
Skype has 170 million users. Phone, messaging, chat.
Microsoft has Lync, Hotmail, Outlook, Messenger and Xbox LIVE, plus Kinect and Windows Phone and other communications devices.
(If you have been a user of the Live brand, have you noticed that Microsoft has not been pelting you with announcements of Live Mail and Live Apps and Live Messaging and Live Voice, for the past while? I hadn’t given it a lot of thought until now.)
Microsoft will connect Skype users with most or all of those. Microsoft will keep developing Skype capabilities and selling its services, and will have to support its users and serve them on non-Microsoft platforms and others used by Skype aficionados.
Steve Ballmer sounds ecstatic about the acquisition. “Skype is a phenomenal service that is loved by millions of people around the world,” says the Great Pate. “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.”
Skype’s CEO, Tony Bates, will become Microsoft Skype Division president, and will report to Ballmer.
Bates is just as, um, conservative in his vision as ever. He says the combined company will “accelerate Skype’s plans to extend our global community and introduce new ways for everyone to communicate and collaborate.”
Everyone. Sounds pretty inclusive, doesn’t it?
Skype was only two years old when eBay acquired it, and, like PayPal, it did help eBay buyers and sellers consummate their deals. But eBay did not continue to develop Skype beyond what it deemed necessary to maximize its usefulness to eBay.
After Silver Lake and the other investors acquired Skype a year and a half ago, it promoted use of Skype and “acquired intellectual property powering its peer-to-peer network.” eBay still has a stake in Skype.
It will be interesting to see where Skype goes from here.
* * *
Hoeing out a file drawer, I came across a folder labeled “Gravitz Associates.” I hadn’t bought anything from Gravitz Associates recently—not sure what, if anything Joel is selling these days, or where. But according to an invoice, in 1990 I bought a “Panawana 1124” for $325.
That is what Joel called the Panasonic dot matrix printer I bought from him. I called it a Sonapanic because of its nerve-wracking scream, as it placed those dots in their matrices at resolutions of 1124dots per inch, creating NLQ (near-laser quality) text.
Two years earlier I had bought an “IBM Compatible” computer from Joel, for $1,125 plus tax. It had a 360 Kb floppy drive (that would have been a 5.25-incher) and a 20 Mb hard drive. The bundle included keyboard, mouse, a monochrome CRT monitor, MS DOS 3.3 for an operating system, Microsoft Works, and a printer cable.
I saved several hundred by getting Joel to build me a “compatible.” Later I sold it to a local video rental store owner for $500, saving her quite a lot compared with a new one. Those were the days, huh?
E email@example.com. Skype lilimartini.