The Skype Deal causing a social Media tornado

Skype has redefined the way people communicated all around the world although running in losses yet the deal between Microsoft and Skype was watched all around the world with awe and surprise. With the big titans clashing head on to expand their market share in the digital world this deal is surely going to be a turning point.

There have been instances where we have observed that many big corporations wanted to won Skype Ebay is a big live example. Microsoft a big player in window phones will surely be getting an edge over its arch rivals. This deal is surely going to keep the windows giant's flag held high in the communication arena. In what was rumored to be a bidding war between Facebook and Microsoft, ended with a price tag not seen for quite some time.

While we (in Australia) were all sleeping, Microsoft bought the Estonian company Skype for $8.5 billion. Such big deals always have an international implication given the usage of products of Microsoft and Skype all over the world. What makes this even more tremendous, is that Skype isn’t even profitable as yet – and has tremendous debt.

Last year Skype’s revenues sat at $860 million, and had operating profits of $264 million. The company also carries $686 million in debt. Many people will also see this decision of Microsoft with skeptism as buying an organization neck deep in debt is no child's play. It is believed the Skype purchase was a tasty one by Microsoft: to further integrate into the Social web, and to claim its large user base of 663 million users. The takeover of Skype allows Microsoft to integrate new services into its product range. Namely, to make aggressive inroads into the mobile market.

With the awesome facilities like video chatting and voice chatting being provided by Skype Microsoft has already gained access to billions of customers all across the world. The major move that needs to be observed in future is how Microsoft taps this big market and what changes it is going to experiment with Skype.

On the other end there have been ripples in the market about bringing out a new IM with all the functionalities of Skype lest Microsoft makes Skype a paid service.

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Article Source :- http://www.strongmandigital.com.au/2011/05/11/microsoft-buys-skype-for-8-5-billion/