What the… I don’t even… Straight out of left field. What could this all mean? Last we heard, Google and Facebook were vying for Skype and possibly looking to partner up. According to the Wall Street Journal:
Microsoft Corp. is close to a deal to buy Internet phone company Skype Technologies SA for more than $7 billion, and a deal could be announced as early as Tuesday, people familiar with the matter said.
This is a huge move for Microsoft, giving them a foot in the convergent world of online communication. What could this mean for the future? Are we looking at new, deeper integration with Microsoft services? Windows Phone 7 deep level integration? Perhaps a video chat service for Facebook since there is already precedent of Facebook play with the Bing integration. We’ll have to see. For now, follow the source for the full report. All I can say is I think Microsoft just overpaid for Skype…
All Things D is saying that the deal is actually already done and confirmed for $8.5 billion. If this is true, I’m not so sure anymore. It makes sense for Skype but Microsoft is paying way more than Skype is worth. It’s never crossed the $1 billion mark in revenues, with its peak being just north of $800 million and it still posted a net loss in the tens of millions. It’s a necessary and vital system but we need to see how Ballmer makes this deal make sense. The announcement should happen tomorrow morning.