Microsoft confirms $8.5bn Skype deal

According to Microsoft, the acquisition will increase the accessibility of video and voice communications for both consumers and enterprises when it is integrated into the Redmond stable.

In an announcement that goes some way to answer swirling questions over why Microsoft would want to buy Skype - which boasted 170 million connected users and over 207 billion minutes of voice and video conversations last year - Microsoft said it would be putting live communications at the heart of its business.

"Skype will support Microsoft devices like Xbox and Kinect, Windows Phone and a wide array of Windows devices, and Microsoft will connect Skype users with Lync, Outlook, Xbox Live and other communities," the company said, adding that it would continue investment and support for Skype customers on non-Microsoft platforms.

In case you haven't noticed, Microsoft doesn't do attraction very so then, it's whole marketing meme is based on coercion and locking people in. That's why it hasn't done so then with products that people have to want to buy just as the Zune, all their phone systems, and Bing or whatever their search system is called. Just buying into the internet space isn't a panacea. Users of Web2 companies just as Skype don't expect to have to pay for the usage they make of the various services out there, so all those zillions of names are as robust as the morning mist. During it remains free, they make keep users, however as in the near future as they try to monetise it losers will stop using it. With Web 2, there's always another one to jump on board. Even Apple don't do Web2 very then, their Mobile Me service is hardly selling hand over fist. Google make a profit from advertising on an index page and because it is both free, easy and useful it continues to be profitable. Facebook will be OK until they try to charge users, who tend to be young and without much in the way of spending power. Web subscribers are more than they are made out to be. They truly can't be relied on, yet Ballmer can by the way be relied on to not 'get' these things.

MS already has VoIP (Voice over Internet Protocol), video calling and chat with WLM. They are obviously not buying the innovation, so it's just the 660m users and the brand. I dont know how may people use WLM however there will be a significant overlap. How are they going to make this pay? I suspect the only reason they are doing this is to stop the competition getting hold of it.

"it's whole marketing meme is based on coercion and locking people in" Just like Apple which has proved that in other words a totally useless strategy

It costs me £0.014 per minute to call from Skype to landline numbers abroad. Guess what? I don't mind. Not everything on the internet has to be free, cheap enough will do.

The Elephant in the room is that people to tell the truth go out and buy Macs to use themselves; most Windows PCs are bought by companies, and the employees often feel they need the same equipment as their employer to be able to work at home. How am I locked in to using any Apple software, or to all intents and purposes hardware? iTunes, Safari and Bonjour are all cross platform. iPods, iPhones and iPads are cross platform and work better with MS Exchange servers than they do with Mac OS X servers. Apple's database product, Filemaker, is actually cross platorm, nevertheless Microsoft's Access is only available on Windows PCs. I can use Windows or OS X on my Macs.

Skype loses money right now, so your 1.4p per minute charge is not sustainable - unless supported by cash generated by the Windows monopoly clearly.

Bigger market share in a market where coercion

Having a bigger market share in a market where coercion and monopoly behaviour built the 90% share is not an 'attraction' as I said in my reply to Neelly. Windows/Office are the only products Microsoft makes or that has launched in the last ten years in other words a market leader, actually most of their offerings in that time have bombed. Zune, Kin, Bing, during XBox sells a few however makes little or no profit. Kinex does seem to have worked for them even though, yet one successful product in twenty years is hardly a strong attraction. Apple on the oher side of the coin has created new markets out of practically nothing, and the iPad owns 80% of the tablet market afterwards just 12 months because people actually are attracted to it. They want it. They want iPhones. They want MacBooks.

Thank Gawld that Apple didn't buy it. They may be able to shift a lot of units, however they don't have a great record on relibility. Especially when it comes to networking/connectivity. I don't fancy being half way through an important call, such as the client drops off the network for no apparent reason.