Analysis: Microsoft buys Skype

Skype

Video calling could be one of the main reasons Skype's been snapped up by Microsoft.

In a move that has surprised the tech industry, Microsoft has splashed out $8.5 billion (about £5.2 billion) on Skype. It’s a curious move that seems to fall precisely half-way between savvy and crazy. On one hand, Microsoft’s partnership with Nokia in the smartphone space could heavily integrate Skype, providing a high-profile competitor to Google Voice and Apple's FaceTime that Microsoft owns and controls. On the other, there are arguments that this is another case of Microsoft firing wildly and snapping up a popular technology, without any real consideration regarding its profitability.

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