8.5 bill on skype? worth it? thoughts?

So now that Ballmer went and bought Skype, what are your thoughts? What's gonna happen to skype? Smooth move by MS?

Personally I think if Apple did to Facetime what they did with iTunes....free and across platforms...Skype would go downhill in no time. Granted Skype has all the landlines but still for the people who use it just to keep in touch? I think Facetime would dominate.

What do you guys think? And while were at it, for those of you who moved Skype to your trash bin today, what do you use instead? I would go with iChat but I don't know many people who have AIM and facetime only works for Macs. for the time being anyway....

Not really concerned with who owns it, provided it works just as well as it always has for me.

What I'm curious about is how Microsoft will rebrand it. Going with their current naming convention, I'm guessing it's going to be something like "Microsoft Windows Communicator System Skype 7" ;D

IMHO anyone who trashed Skype just because Microsoft bought it needs help.

Skype themselves were horrible when it came to Mac support and parity between clients, always have been. I wouldn't expect it to get any worse and might even get better.

As for iChat/AIM as a competitor, depends on where you live. In the US AIM and Yahoo are the big players, not many use Skype. Internationally Skype and MSN are bigger.

FaceTime works with Macs and iOS devices, that's a lot of people.

I'm still boggled at the figure. Google bought YouTube for $1.65 billion and YT wasn't turning a profit (nor had it ever). I figured that was as high as it was going to go for companies that didn't turn a profit but evidently I was wrong. $8 billion for something that doesn't generate profit seems exceedingly excessive.

vansmith said:

I'm still boggled at the figure. Google bought YouTube for $1.65 billion and YT wasn't turning a profit (nor had it ever). I figured that was as high as it was going to go for companies that didn't turn a profit but evidently I was wrong. $8 billion for something that doesn't generate profit seems exceedingly excessive.

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Skype does generate profit. There are services that cost money to use on it.
Is it worth 8 BILLION? I don't know...depends on M$FT's real motive.

The only people I would video chat with are my immediate family and they all have an iPhone 4 so we just use Face Time. No need for Skype here, so this has no impact on me.
I do suspect MS will make improvements to it because they gotta do something to stay competitive. I especially see them implementing Skype deeply into their mobile phone OS structure. It will probably become for them what Face Time is for Macs and iOS devices.

idrinorbarsaku said:

Skype does generate profit. There are services that cost money to use on it.
Is it worth 8 BILLION? I don't know...depends on M$FT's real motive.

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There's a difference between revenue and profit. If I sell you something for $20 that I bought for $20, you gave me money (I provided a service that costed you money) but I didn't turn a profit. In terms of Skype, to quote this article:

Last year, Skype had revenue of $860 million on which it posted an operating profit of $264 million. However, overall it made a small loss of $7 million, and had long-term debt of $686 million.

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What's even more staggering is this statistic:

Even the access to paying customers is hard to justify. The terms of the deal mean that for each Skype customer, Microsoft is paying about $1,000. And on average, those customers are worth a profit of about $30, presuming most of Skype’s income comes from subscriptions and call charges. That’s a huge disparity.

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