Microsoft Nearing $7 Billion Deal to Purchase Skype

The Wall Street Journal, Bloomberg BusinessWeek and Reuters are all reporting that Microsoft is in the final stages of talks to purchase Skype from its current group of investors for $7 billion. The completion of the deal would see Microsoft acquire the largest VoIP (Voice over Internet Protocol) operator in terms of customer base as so then as serve as another addition to its wayward internet services group which includes the Bing search engine amongst other products.

The deal follows initial plans for the company to file for an IPO in August last year which were shelved with the installation of new CEO Tony Bates. The planned IPO was to have valued Skype at over $1 billion dollars with its current debt load sitting at $686 million as of December of last year. Skype currently offers service for mobile phones across major platforms and as well counts select carriers as partners with Verizon Wireless in the US and Three in the UK/Europe offering Skype over their respective networks over a custom client which tunnels standard calls over 3G data networks on supported devices.

All of the reports take care to note that the deal could fall through anytime tonight, nevertheless should it be completed, an announcement is expected between tomorrow and Wednesday while rival Google's I/O developer conference. With Skype, Microsoft is expected to have a furthermore tool to draw clients to use its internet products and services just as Internet Explorer 9, Bing and Office via the Lync protocol, which bridges IM/Email/Voice services at the same time seamlessly for interoffice communication.

The initial IPO fervor last year

During the initial IPO fervor last year, Skype recommended that it was looking to sell itself to the highest bidder for between $5-$6 billion which attracted the interest of Google, Cisco Systems and even Facebook previously shelving those plans afterwards talks led nowhere. With Microsoft leading the acquisition talks for all that, the software giant stands to gain a popular product that could be integrated across all of its product lines, from Office to Xbox Live and Windows Phone 7. In its turn, Skype would be able to focus on developing its core product and protocol nevertheless it as well stands to fall victim to the Microsoft Effect, most recently demonstrated with the acquisition of the Danger team in 2008, which led to the development of Kin earlier the team was scattered across the larger company due to the failure of the product.

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