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Skype Technologies S.A.R.L (also known as Skype Software S.A.R.L, Skype Communications S.A.R.L, Skype Inc., and Skype Limited) is a
Luxembourgish Luxembourgish ( ; also ''Luxemburgish'', ''Luxembourgian'', ''Letzebu(e)rgesch''; Luxembourgish: ) is a West Germanic language that is spoken mainly in Luxembourg. About 400,000 people speak Luxembourgish worldwide. As a standard form of th ...
telecommunications Telecommunication is the transmission of information by various types of technologies over wire, radio, optical, or other electromagnetic systems. It has its origin in the desire of humans for communication over a distance greater than that fe ...
company headquartered in
Luxembourg City Luxembourg ( lb, Lëtzebuerg; french: Luxembourg; german: Luxemburg), also known as Luxembourg City ( lb, Stad Lëtzebuerg, link=no or ; french: Ville de Luxembourg, link=no; german: Stadt Luxemburg, link=no or ), is the capital city of the Lu ...
,
Luxembourg Luxembourg ( ; lb, Lëtzebuerg ; french: link=no, Luxembourg; german: link=no, Luxemburg), officially the Grand Duchy of Luxembourg, ; french: link=no, Grand-Duché de Luxembourg ; german: link=no, Großherzogtum Luxemburg is a small lan ...
, whose chief business is the manufacturing and marketing of the
video chat Videotelephony, also known as videoconferencing and video teleconferencing, is the two-way or multipoint reception and transmission of audio and video signals by people in different locations for real time communication.McGraw-Hill Concise Ency ...
and
instant messaging Instant messaging (IM) technology is a type of online chat allowing real-time text transmission over the Internet or another computer network. Messages are typically transmitted between two or more parties, when each user inputs text and trigge ...
computer software program
Skype Skype () is a proprietary telecommunications application operated by Skype Technologies, a division of Microsoft, best known for VoIP-based videotelephony, videoconferencing and voice calls. It also has instant messaging, file transfer, deb ...
, and various
Internet telephony Voice over Internet Protocol (VoIP), also called IP telephony, is a method and group of technologies for the delivery of voice communications and multimedia sessions over Internet Protocol (IP) networks, such as the Internet. The terms Internet t ...
services associated with it.
Microsoft Microsoft Corporation is an American multinational technology corporation producing computer software, consumer electronics, personal computers, and related services headquartered at the Microsoft Redmond campus located in Redmond, Washing ...
purchased the company in 2011, and it has since then operated as their wholly owned subsidiary; as of 2016, it is operating as part of Microsoft's Office Product Group. The company is a ''
Société à responsabilité limitée A (SARL, S.à r.l. and similar; literally "society with limited responsibility") is a form of private company that exists mainly in French-speaking countries, such as France, Luxembourg, Monaco, Algeria, Morocco, Tunisia, Madagascar, Lebanon, ...
'', or SARL, equivalent to an American
limited liability company A limited liability company (LLC for short) is the US-specific form of a private limited company. It is a business structure that can combine the pass-through taxation of a partnership or sole proprietorship with the limited liability of a ...
. Skype, a
voice over IP Voice over Internet Protocol (VoIP), also called IP telephony, is a method and group of technologies for the delivery of speech, voice communications and multimedia sessions over Internet Protocol (IP) networks, such as the Internet. The terms In ...
(VoIP) service, was first released in 2003 as a way to make free computer-to-computer calls, or reduced-rate calls from a computer to telephones. Support for paid services such as calling landline/mobile phones from Skype (formerly called SkypeOut), allowing landline/mobile phones to call Skype (formerly called SkypeIn and now Skype Number), and voice messaging generates the majority of Skype's revenue.
eBay eBay Inc. ( ) is an American multinational e-commerce company based in San Jose, California, that facilitates consumer-to-consumer and business-to-consumer sales through its website. eBay was founded by Pierre Omidyar in 1995 and became a ...
acquired Skype Technologies S.A. in September 2005 and in April 2009 announced plans to spin it off in a 2010
initial public offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investment ...
(IPO). In September 2009,
Silver Lake Silver is a chemical element with the Symbol (chemistry), symbol Ag (from the Latin ', derived from the Proto-Indo-European wikt:Reconstruction:Proto-Indo-European/h₂erǵ-, ''h₂erǵ'': "shiny" or "white") and atomic number 47. A soft, whi ...
,
Andreessen Horowitz Andreessen Horowitz (also called a16z, legal name AH Capital Management, LLC) is a private American venture capital firm, founded in 2009 by Marc Andreessen and Ben Horowitz. The company is headquartered in Menlo Park, California. Andreessen ...
and the
Canada Pension Plan Investment Board The Canada Pension Plan Investment Board (CPPIB; french: Office d'investissement du régime de pensions du Canada), operating as CPP Investments (french: Investissements RPC), is a Canadian Crown corporation established by way of the 1997 ''Cana ...
announced the acquisition of 65% of Skype for $1.9 billion from
eBay eBay Inc. ( ) is an American multinational e-commerce company based in San Jose, California, that facilitates consumer-to-consumer and business-to-consumer sales through its website. eBay was founded by Pierre Omidyar in 1995 and became a ...
, valuing the business at $2.75 billion. Skype was acquired by
Microsoft Microsoft Corporation is an American multinational technology corporation producing computer software, consumer electronics, personal computers, and related services headquartered at the Microsoft Redmond campus located in Redmond, Washing ...
in May 2011 for $8.5 billion. As of 2010, Skype was available in 27 languages and has 660 million worldwide users, an average of over 100 million active each month, and has faced challenges to its intellectual property amid political concerns by governments wishing to control telecommunications systems within their borders.


History

* Skype was founded in 2003 by
Janus Friis Janus Friis (; born 26 June 1976) is a Danish entrepreneur best known for co-founding the file-sharing application Kazaa, and the peer-to-peer telephony application Skype. In September 2005, he and his business partner Niklas Zennström sold Sk ...
from Denmark and
Niklas Zennström Niklas Zennström (; born 16 February 1966) is a Swedish entrepreneur and technology investor. Zennström is also the co-founder of the charity organization Zennström Philanthropies. Education Zennström has dual degrees in Business Administr ...
from Sweden, having its headquarters in
Luxembourg Luxembourg ( ; lb, Lëtzebuerg ; french: link=no, Luxembourg; german: link=no, Luxemburg), officially the Grand Duchy of Luxembourg, ; french: link=no, Grand-Duché de Luxembourg ; german: link=no, Großherzogtum Luxemburg is a small lan ...
with offices now in
Tallinn Tallinn () is the most populous and capital city of Estonia. Situated on a bay in north Estonia, on the shore of the Gulf of Finland of the Baltic Sea, Tallinn has a population of 437,811 (as of 2022) and administratively lies in the Harju ' ...
,
Tartu Tartu is the second largest city in Estonia after the Northern European country's political and financial capital, Tallinn. Tartu has a population of 91,407 (as of 2021). It is southeast of Tallinn and 245 kilometres (152 miles) northeast of ...
,
Stockholm Stockholm () is the Capital city, capital and List of urban areas in Sweden by population, largest city of Sweden as well as the List of urban areas in the Nordic countries, largest urban area in Scandinavia. Approximately 980,000 people liv ...
,
London London is the capital and largest city of England and the United Kingdom, with a population of just under 9 million. It stands on the River Thames in south-east England at the head of a estuary down to the North Sea, and has been a majo ...
,
Palo Alto Palo Alto (; Spanish for "tall stick") is a charter city in the northwestern corner of Santa Clara County, California, United States, in the San Francisco Bay Area, named after a coastal redwood tree known as El Palo Alto. The city was estab ...
,
Prague Prague ( ; cs, Praha ; german: Prag, ; la, Praga) is the capital and largest city in the Czech Republic, and the historical capital of Bohemia. On the Vltava river, Prague is home to about 1.3 million people. The city has a temperate ...
, and
Redmond, Washington Redmond is a city in King County, Washington, United States, located east of Seattle. The population was 73,256 at the 2020 census, up from 54,144 in 2010. Redmond is best known as the home of Microsoft and Nintendo of America. With an an ...
. * The Skype software was originally developed by
Estonia Estonia, formally the Republic of Estonia, is a country by the Baltic Sea in Northern Europe. It is bordered to the north by the Gulf of Finland across from Finland, to the west by the sea across from Sweden, to the south by Latvia, a ...
ns
Ahti Heinla Ahti Heinla (born 2 May 1972) is an Estonian computer programmer and businessman. He is one of the developers of Skype. He was also an organizer of Let's Do It 2008, a civic action with 50,000 volunteers participating in cleaning up the countr ...
,
Priit Kasesalu Priit Kasesalu (born 10 April 1972) is an Estonian programmer and software developer best known for his participation in the development of Kazaa, Skype and, most recently, Joost. He currently works for Ambient Sound Investments and lives in ...
and
Jaan Tallinn Jaan Tallinn (born 14 February 1972) is an Estonian billionaire computer programmer and investor known for his participation in the development of Skype and file-sharing application FastTrack/ Kazaa. Jaan Tallinn is a leading figure in the field ...
, who together with
Janus Friis Janus Friis (; born 26 June 1976) is a Danish entrepreneur best known for co-founding the file-sharing application Kazaa, and the peer-to-peer telephony application Skype. In September 2005, he and his business partner Niklas Zennström sold Sk ...
and
Niklas Zennström Niklas Zennström (; born 16 February 1966) is a Swedish entrepreneur and technology investor. Zennström is also the co-founder of the charity organization Zennström Philanthropies. Education Zennström has dual degrees in Business Administr ...
were also behind the peer-to-peer file sharing software Kazaa. In April 2003, Skype.com and Skype.net domain names were registered. In August 2003, the first public beta version was released. * One of the initial names for the project was "Sky peer-to-peer", which was then abbreviated to "Skyper". However, some of the domain names associated with "Skyper" were already taken. Dropping the final "r" left the current title "Skype", for which domain names were available. * In September 2005, SkypeOut was banned in China. In October of the same year,
eBay eBay Inc. ( ) is an American multinational e-commerce company based in San Jose, California, that facilitates consumer-to-consumer and business-to-consumer sales through its website. eBay was founded by Pierre Omidyar in 1995 and became a ...
purchased Skype for $2.6 billion. (In 2011, the ''
Ars Technica ''Ars Technica'' is a website covering news and opinions in technology, science, politics, and society, created by Ken Fisher and Jon Stokes in 1998. It publishes news, reviews, and guides on issues such as computer hardware and software, sci ...
'' estimated the purchase price at $3.1 billion, not $2.6 billion.) In December 2005,
videotelephony Videotelephony, also known as videoconferencing and video teleconferencing, is the two-way or multipoint reception and transmission of audio and video signals by people in different locations for real time communication.McGraw-Hill Concise Ency ...
was introduced. * In April 2006, the number of registered users reached 100 million. In October 2006, Skype 2.0 for Mac was released, the first full release of Skype with video for Macintosh, and in December, Skype announced a new pricing structure, with connection fees for all SkypeOut calls. Skype 3.0 for Windows was released. * In 2006, a feature called "Skypecasting" was introduced as a beta. It allowed recordings of Skype
voice over IP Voice over Internet Protocol (VoIP), also called IP telephony, is a method and group of technologies for the delivery of speech, voice communications and multimedia sessions over Internet Protocol (IP) networks, such as the Internet. The terms In ...
voice calls and
teleconference A teleconference is the live exchange of information among several people remote from one another but linked by a telecommunications system. Terms such as audio conferencing, telephone conferencing and phone conferencing are also sometimes used t ...
s to be used as podcasts. Skypecasting remained in beta until it was discontinued on 1 September 2008. Skypecasts hosted public conference calls for up to 100 people at a time. Unlike ordinary Skype p2p conference calls, Skypecasts supported moderation features suitable for panel discussions, lectures, and town hall forums. Skype operated a directory of public Skypecasts. * Throughout 2007, updates (3.1, 3.2 and 3.5) added new features including Skype Find, Skype Prime, Send Money (which allowed users to send money via
PayPal PayPal Holdings, Inc. is an American multinational financial technology company operating an online payments system in the majority of countries that support online money transfers, and serves as an electronic alternative to traditional paper ...
from one Skype user to another), video in mood, inclusion of video content in chat, call transfer to another person or a group, and auto-redial. Skype 2.7.0.49 (beta) for Mac OS X released adding availability of contacts in the Mac Address Book to the Skype contact list, auto redial, contact groups, public chat creation, and an in-window volume slider in the call window. During several days in August, Skype users were unable to connect to full Skype network in many countries because of a Skype system-wide crash which was the result of exceptional number of logins after a Windows patch reboot ("
Patch Tuesday Patch Tuesday (also known as Update Tuesday) is an unofficial term used to refer to when Microsoft, Adobe, Oracle and others regularly release software patches for their software products. It is widely referred to in this way by the industry. Micr ...
"). In November, there was controversy when it was announced that users allocated certain London 020 numbers (specifically those beginning '7870') would lose them, after negotiations with the provider of this batch of numbers broke down. * By early 2008, the tumultuous ownership relations between the founders and eBay had resulted in significant leadership churn, with a succession of Skype presidents including Niklas Zennström, Rajiv Dutta, Alex Kazim, Niklas Zennström (again), and Henry Gomez, all holding that title at various points between 2005 and 2007. The business had failed to meet certain earn-out targets, growth was decelerating, product development had slowed significantly, and in October 2007 eBay took a $1.4 billion 'impairment' on the value of Skype, admitting it had overpaid, and now valuing the company at about $2.7 billion. * In October 2008, analysis revealed TOM-skype â€” the Chinese version of Skype run by TOM Online â€” sends content of text messages and encryption keys to monitoring servers.


Two original founders depart, new CEO and the eBay years

* For the six months after the departure of Zennström and Friis, Michael van Swaaij led the company as interim CEO, until the appointment of
Josh Silverman Joshua Gordon Silverman (born 1969) is an American entrepreneur and technology executive currently serving as chief executive officer of Etsy. He is known for co-founding the invitation website Evite and serving as CEO of Skype (2008–10) and s ...
in February 2008. Silverman was "widely viewed as bringing in stability to Skype after a tumultuous phase that followed the exit of the two Skype co-founders." Under Silverman's two-and-a-half year tenure, the company focused its product efforts around video calling, ubiquity (gaining high penetration on smartphones, PCs, TVs, and consumer-electronic devices), building tailored offerings for enterprise customers, and diversifying revenue through subscriptions, premium accounts and advertising. * In advancing this strategy, Skype released many new products, substantially revamping its flagship
Windows Windows is a group of several proprietary graphical operating system families developed and marketed by Microsoft. Each family caters to a certain sector of the computing industry. For example, Windows NT for consumers, Windows Server for serv ...
software (3.8 -> 4.0), and its
macOS macOS (; previously OS X and originally Mac OS X) is a Unix operating system developed and marketed by Apple Inc. since 2001. It is the primary operating system for Apple's Mac computers. Within the market of desktop and lapt ...
and
Linux Linux ( or ) is a family of open-source Unix-like operating systems based on the Linux kernel, an operating system kernel first released on September 17, 1991, by Linus Torvalds. Linux is typically packaged as a Linux distribution, which ...
software; while introducing new software products for smartphones, and consumer electronics. In 2009, Skype 4.0 was released, featuring full-screen high-quality video calling. the Linux client was updated, and an iPhone application was launched which topped the charts with over 1M downloads in its first two days. Skype also announced the launch of its software for the Android platform. * During this period Skype also discontinued lesser-used services such as support for the "Skype Me" presence indicator, which meant that a user was interested in receiving Skype calls from a non-contact. Skype also discontinued its SkypeCast service without explanation and added internal monthly and daily usage caps on their SkypeOut subscriptions, which had been advertised as "unlimited". Skype also discontinued its "dragonfly" feature, a community-generated yellow-pages product, and other features which were deemed to be under-performing or a distraction to management. Many users and observers had commented on the high rate of dropped calls and the difficulty reconnecting dropped calls. Updates including versions for the
Sony , commonly stylized as SONY, is a Japanese multinational conglomerate corporation headquartered in Minato, Tokyo, Japan. As a major technology company, it operates as one of the world's largest manufacturers of consumer and professional ...
PSP hand-held gaming system, version 2.0 for Linux with support for video-conferencing. * As part of its efforts to diversify revenues, Skype launched in April 2008 ''Skype for SIP'', a service aimed at business users. At that time around 35 per cent of Skype's users were business users. In targeted premium products to consumers, Skype launched new monthly premium subscriptions products in May 2010. * Marketing efforts were also re-vamped, with a particular focus on innovative partnerships with TV broadcasters to integrate Skype into their programming.
The Oprah Winfrey Show ''The Oprah Winfrey Show'', often referred to as ''The Oprah Show'' or simply ''Oprah'', is an American daytime broadcast syndication, syndicated talk show that aired nationally for 25 seasons from September 8, 1986, to May 25, 2011, in Chicag ...
began using Skype regularly to host video calls between Oprah and her viewers at home, culminating in a show dedicated exclusively to the wonders of Skype ("where the Skype are You", aired first in May 2009). Skype also became commonly used by network news stations around the world, as a cost-effective replacement for sending
satellite truck A satellite truck is a mobile communications satellite ground station mounted on a truck chassis as a platform. Employed in remote television broadcasts, satellite trucks transmit video signals back to studios or production facilities for editing ...
s, and enabling fast response from citizen journalists. Skype was also integrated into scripted TV programming, such as
Californication Californication may refer to: *Californication (word) ''Californication'' is a portmanteau of California and fornication, appearing in ''Time'' on May 6, 1966 and written about on August 21, 1972, additionally seen on bumper stickers in the U.S. ...
; and in the seventh season of the U.S. syndicated version of the British game show ''
Who Wants To Be a Millionaire ''Who Wants to Be a Millionaire?'' (often informally called ''Millionaire'') is an international television game show franchise of British origin, created by David Briggs, Mike Whitehill and Steven Knight. In its format, currently owned and ...
'' in a new ''Ask the Expert'' video chat lifeline. * These efforts led to accelerating growth of Skype's Connected Users and Paying Users and by 2009 Skype was adding about 380,000 new users each day. By the end of 2009 Skype was generating around
US$ The United States dollar (symbol: $; code: USD; also abbreviated US$ or U.S. Dollar, to distinguish it from other dollar-denominated currencies; referred to as the dollar, U.S. dollar, American dollar, or colloquially buck) is the official ...
740
million One million (1,000,000), or one thousand thousand, is the natural number following 999,999 and preceding 1,000,001. The word is derived from the early Italian ''millione'' (''milione'' in modern Italian), from ''mille'', "thousand", plus the au ...
in revenue. * In January 2010, Josh Silverman was recognized for his accomplishments at Skype by being named First Runner Up in the TechCrunch "Crunchies" award for "Best CEO", beaten only by
Mark Pincus Mark Jonathan Pincus (born February 13, 1966) is an American Internet entrepreneur known as the founder of Zynga, a mobile social gaming company. Pincus also founded the startups Freeloader, Inc., Tribe Networks, and Support.com. Pincus served as ...
of
Zynga Zynga Inc. () is an American developer running social video game services. It was founded in April 2007, with headquarters in San Mateo, California. The company primarily focuses on mobile and social networking platforms. Zynga states its missio ...
.


Independence and Silver Lake

* Building on the revitalization which had begun in 2008,
eBay eBay Inc. ( ) is an American multinational e-commerce company based in San Jose, California, that facilitates consumer-to-consumer and business-to-consumer sales through its website. eBay was founded by Pierre Omidyar in 1995 and became a ...
announced, in April 2009, plans to spin off Skype through an initial public offering in 2010. In August, Joltid, Ltd. filed a motion with the U.S. Securities and Exchange Commission, seeking to terminate a licensing agreement with eBay which allowed eBay (and therefore Skype) to use the ''peer-to-peer communications technology'' on which Skype is based. If successful, this could have caused a shutdown of Skype as it existed, and made an
IPO An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investment ...
challenging to execute. In September, eBay announced the sale of 65 per cent of Skype to a consortium of
Index Ventures Index Ventures is a European venture capital firm with dual headquarters in San Francisco and London, investing in technology-enabled companies with a focus on e-commerce, fintech, mobility, gaming, infrastructure/ AI, and security. Since its f ...
and
Silver Lake Partners Silver Lake is an American global private equity firm focused on investments in technology, technology-enabled and related industries. Founded in 1999, the firm is one of the largest technology investors in the world. Its investment holdings have ...
. Early in September, Skype shut down the Extras developer program. In November, Skype settled the Joltid litigation and acquired all Skype technology in exchange for equity in the company and eBay completed the sale of 70% of Skype to a consortium comprising Silver Lake Partners, Joltid,
CPPIB The Canada Pension Plan Investment Board (CPPIB; french: Office d'investissement du régime de pensions du Canada), operating as CPP Investments (french: Investissements RPC), is a Canadian Crown corporation established by way of the 1997 ''Can ...
, and
Andreessen Horowitz Andreessen Horowitz (also called a16z, legal name AH Capital Management, LLC) is a private American venture capital firm, founded in 2009 by Marc Andreessen and Ben Horowitz. The company is headquartered in Menlo Park, California. Andreessen ...
for approximately $2 billion, valuing the entire business at US$2.75 billion. * In May 2010, Skype 5.0 beta was released, with a capacity to support group video calls involving up to four participants. Also in May, Skype released an updated client for the Apple iPhone that allowed Skype calls to be made over a 3G network. Originally, a 3G call subscription plan was to be instituted in 2011, but Skype eventually dropped the plan. Rounding out its ubiquity push, Skype also announced deep integration of Skype software into the IP-connected TVs from
Panasonic formerly between 1935 and 2008 and the first incarnation of between 2008 and 2022, is a major Japanese multinational corporation, multinational Conglomerate (company), conglomerate corporation, headquartered in Kadoma, Osaka, Kadoma, Osaka P ...
,
Samsung The Samsung Group (or simply Samsung) ( ko, 삼성 ) is a South Korean multinational manufacturing conglomerate headquartered in Samsung Town, Seoul, South Korea. It comprises numerous affiliated businesses, most of them united under the ...
and
Sony , commonly stylized as SONY, is a Japanese multinational conglomerate corporation headquartered in Minato, Tokyo, Japan. As a major technology company, it operates as one of the world's largest manufacturers of consumer and professional ...
. * In June 2010, following the rapid departure of Daniel Berg, the chief technology officer, and then chief development officer Madhu Yarlagadda, Mark Gillett, an
operating partner An operating partner is a title used by venture capital (VC) and private equity (PE) firms to describe a role dedicated to working with privately held companies to increase value. The role was created by large-capitalization private equity groups wh ...
at Silver Lake Partners, assumed the role of chief development officer, taking responsibility for development of Skype's client software, cloud services and product management following a period of several months working closely with Joshua Silverman to drive the transformation of the business, and the acceleration of cross platform and mobile product delivery. * With its newfound independence and under ownership, Skype's growth accelerated and by 2010, Telegeography estimated that Skype accounted for 25 per cent of the world's international calling minutes. According to their research, the overall international calling market grew a tepid 5 to 6 per cent annually in 2010. "Skype, however, has seen a huge uptick in growth, particularly in the last two years." * On 9 August 2010, Skype filed with the
United States Securities and Exchange Commission The U.S. Securities and Exchange Commission (SEC) is an independent agency of the United States federal government, created in the aftermath of the Wall Street Crash of 1929. The primary purpose of the SEC is to enforce the law against market ...
(SEC) to raise up to US$100 million in an
initial public offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investment ...
. Sources reported that the company expected to raise at least US$1 billion. In October 2010, Skype announced the appointment of
Tony Bates Anthony J. Bates (born 29 April 1967) is a British born business leader. Bates is the former CEO of Growth at Social Capital. Previously, he held a number of technology based business roles including the former president of GoPro, and the for ...
as CEO; Bates was a senior VP at
Cisco Cisco Systems, Inc., commonly known as Cisco, is an American-based multinational digital communications technology conglomerate corporation headquartered in San Jose, California. Cisco develops, manufactures, and sells networking hardware, ...
and was responsible for its multibillion-dollar enterprise, commercial and small business division. On 14 October 2010, Skype 5.0 for Windows was released with a number of improvements and feature additions, including a
Facebook Facebook is an online social media and social networking service owned by American company Meta Platforms. Founded in 2004 by Mark Zuckerberg with fellow Harvard College students and roommates Eduardo Saverin, Andrew McCollum, Dustin M ...
tab to allow users to
SMS Short Message/Messaging Service, commonly abbreviated as SMS, is a text messaging service component of most telephone, Internet and mobile device systems. It uses standardized communication protocols that let mobile devices exchange short text ...
, chat with, or call their Facebook friends via Skype from the News Feed. The "Search for Skype Users" option was omitted from this version. * On 14 January 2011, Skype acquired
Qik Skype Qik was a video messaging service by Skype. It was created by the company, Skype Technologies, who acquired ''Qik''. The service, offered for Android, iOS, and Windows Phone devices, allowed users to exchange video messages between i ...
, a mobile video-sharing platform. In March 2011, Skype named Jonathan Chadwick as its new chief financial officer and confirmed that Mark Gillett would serve full-time as chief development and operating officer following the departure of chief financial and administrative officer Adrian Dillon.


Microsoft subsidiary (2011–present)

* On 10 May 2011,
Microsoft Microsoft Corporation is an American multinational technology corporation producing computer software, consumer electronics, personal computers, and related services headquartered at the Microsoft Redmond campus located in Redmond, Washing ...
announced it had agreed to
acquire ''Acquire'' is a multi-player mergers and acquisitions themed board game. It is played with tiles representing hotels that are arranged on the board, play money and stock certificates. The object of the game is to earn the most money by developi ...
Skype for $8.5 billion. This marked a 300% increase in value for the company in the three years since the eBay write-down in October 2007. This constitutes Microsoft's second largest acquisition to date. It was announced that Skype will become a division within Microsoft, with Skype's former CEO Tony Bates â€”now its president— reporting to Microsoft CEO
Steve Ballmer Steven Anthony Ballmer (; March 24, 1956) is an American business magnate and investor who served as the chief executive officer of Microsoft from 2000 to 2014. He is the current owner of the Los Angeles Clippers of the National Basketball Associ ...
. The price Microsoft agreed to pay for the company is 32 times Skype's operating profits. According to the ''
Financial Times The ''Financial Times'' (''FT'') is a British daily newspaper printed in broadsheet and published digitally that focuses on business and economic current affairs. Based in London, England, the paper is owned by a Japanese holding company, Nik ...
'' this raises fears of a new "tech bubble".
Ars Technica ''Ars Technica'' is a website covering news and opinions in technology, science, politics, and society, created by Ken Fisher and Jon Stokes in 1998. It publishes news, reviews, and guides on issues such as computer hardware and software, sci ...
and the
BBC #REDIRECT BBC #REDIRECT BBC Here i going to introduce about the best teacher of my life b BALAJI sir. He is the precious gift that I got befor 2yrs . How has helped and thought all the concept and made my success in the 10th board exam. ...
...
have questioned the value for Microsoft in the purchase. Microsoft's acquisition of Skype got EU approval on 7 October 2011. * In October 2012, one year after the closure of the Skype acquisition, the newly formed Skype Division took responsibility for Microsoft's other VoIP and Unified Communications product Microsoft Lync. * On 11 July 2013, Microsoft's then-CEO Steve Ballmer announced a reorganization of Microsoft along functional lines and with four engineering groups each led by a senior leader. Microsoft's new Applications and Services Group, led by executive vice president Qi Lu was to include Skype along with Bing and Microsoft Office.  Following a period where the strategy for the Skype business as a part of the broader Microsoft portfolios including Office 365 was established, and Skype's share of the international communications market rose to 36 percent (over 214 billion minutes), Mark Gillett announced that he would be leaving Microsoft to return to
Silver Lake Silver is a chemical element with the Symbol (chemistry), symbol Ag (from the Latin ', derived from the Proto-Indo-European wikt:Reconstruction:Proto-Indo-European/h₂erǵ-, ''h₂erǵ'': "shiny" or "white") and atomic number 47. A soft, whi ...
. * In September 2016, after Qi Lu stepped down from Microsoft, Skype and Office became part of the Office Product Group, led by Rajesh Jha. The other part of the former Apps and Services Group (which includes Bing) became part of a new AI and Research Group.


Palo Alto office

The Skype North American headquarters was opened in early 2013 after the design was completed by San Francisco architect firm Blitz. Located in
Palo Alto, California Palo Alto (; Spanish language, Spanish for "tall stick") is a charter city in the northwestern corner of Santa Clara County, California, United States, in the San Francisco Bay Area, named after a Sequoia sempervirens, coastal redwood tree kno ...
, the space is designed to encourage interaction and spontaneity, while also introducing a sense of humor into the workplace. Fake lawn, cushions that look like boulders, open spaces, and high ceilings accommodate 250 employees in a building. The Palo Alto headquarters also houses a games room complete with a pool table and
table football Table football, also known as foosball, table soccer, futbolito in Mexico, Taca Taca in Chile and Metegol in Argentina is a table-top game that is loosely based on association football. The aim of the game is to move the ball into the opponen ...
machine. The office's silver LEED Silver certification means that it received between 50 and 59 points for its environmentally friendly construction.


Legal issues


P2P licensing dispute lawsuit and IPO

In its 2008 Annual Report, eBay admitted to an ongoing dispute between it and Joltid Ltd. over the licensing of its peer-to-peer "Global Index" technology in its application. It announced that it terminated a
standstill agreement The term standstill agreement refers to various forms of agreement which businesses may enter into in order to delay action which might otherwise take place. A standstill agreement may be used as a form of defence to a hostile takeover, when a t ...
, allowing either company to sue. On 1 April 2009, eBay filed with a UK court to settle the legal dispute. A few days later, eBay announced the planning of a
public stock offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investment ...
in 2010 to spin off Skype as a separate, publicly owned company. Some media outlets characterized the proposed sale and ongoing provision of Skype as being under threat because of the concurrent dispute. On 1 September 2009, a group of investors led by
Silver Lake Silver is a chemical element with the Symbol (chemistry), symbol Ag (from the Latin ', derived from the Proto-Indo-European wikt:Reconstruction:Proto-Indo-European/h₂erǵ-, ''h₂erǵ'': "shiny" or "white") and atomic number 47. A soft, whi ...
bought 65% of Skype for $1.91 billion. This prompted Joltid to countersue eBay on 17 September 2009. Both settled the simultaneous suits in November, resulting in Joltid's part-ownership of the newly formed Skype Limited. The final holding share were with Silver Lake reducing their share to 56%, Joltid entered at 14%, and eBay retained 30%.


Other intellectual property challenges


Streamcast lawsuit

StreamCast Networks StreamCast Networks, Inc., was an American corporation, specializing in peer-to-peer software. Formerly named MusicCity, it created Morpheus, which was one of the first major peer-to-peer Internet applications. StreamCast was a defendant in the ...
filed a complaint in U.S. District Court in Los Angeles, alleging theft of its peer-to-peer technology and violation of the "Racketeer Influenced and Corrupt Organizations" statute. The complaint, titled; StreamCast Networks Inc v. Skype Technologies, S.A., was filed on 20 January 2006 in Federal Court in the Central District of California and assigned Case Number, 2:2006cv00391. The $4.1 billion lawsuit did not name Skype's parent company, eBay, when initially filed. Streamcast's lawsuit was subsequently amended on 22 May 2006 to include eBay and 21 other party defendants. In its lawsuit, Streamcast sought a worldwide injunction on the sale and marketing of eBay's Skype Internet voice communication products, as well as billions of dollars in unspecified damages. The lawsuit was finally dismissed in a decision filed on 19 January 2007.


IDT lawsuit

On 1 June 2006,
Net2Phone Net2phone provides VoIP and cloud computing-based telephony products and services. The company is a subsidiary of IDT Corporation. History Net2Phone was founded in 1990. On July 30, 1999, during the dot-com bubble, the company became a public com ...
(the Internet telephone unit of
IDT Corp. IDT Corporation (originally standing for International Discount Telecommunications) is a multinational provider of cloud communications, point of sale systems, unified communications, and financial services for businesses and consumers, headqu ...
) filed a lawsuit against eBay and Skype accusing the unit of infringing , which was granted in 2000. The lawsuit was settled between the parties in 2010.


GPL lawsuit

In July 2007 Skype was found to be guilty by a German court of violating the
GNU General Public License The GNU General Public License (GNU GPL or simply GPL) is a series of widely used free software licenses that guarantee end users the Four Freedoms (Free software), four freedoms to run, study, share, and modify the software. The license was th ...
in one of its for-sale products, the SMC WSKP100.


Political issues


China 2005

Skype was one of many companies (others include
AOL AOL (stylized as Aol., formerly a company known as AOL Inc. and originally known as America Online) is an American web portal and online service provider based in New York City. It is a brand marketed by the current incarnation of Yahoo (2017â ...
,
Microsoft Microsoft Corporation is an American multinational technology corporation producing computer software, consumer electronics, personal computers, and related services headquartered at the Microsoft Redmond campus located in Redmond, Washing ...
,
Yahoo Yahoo! (, styled yahoo''!'' in its logo) is an American web services provider. It is headquartered in Sunnyvale, California and operated by the namesake company Yahoo! Inc. (2017–present), Yahoo Inc., which is 90% owned by investment funds ma ...
,
Cisco Cisco Systems, Inc., commonly known as Cisco, is an American-based multinational digital communications technology conglomerate corporation headquartered in San Jose, California. Cisco develops, manufactures, and sells networking hardware, ...
) which cooperate with the Chinese government in implementing a system of
Internet censorship in mainland China Internet censorship in the People's Republic of China (PRC) affects both publishing and viewing online material. Many controversial events are censored from news coverage, preventing many Chinese citizens from knowing about the actions of th ...
. Critics of such policies argue that it is wrong for companies to profit from censorship and restrictions on
freedom of the press Freedom of the press or freedom of the media is the fundamental principle that communication and expression through various media, including printed and electronic News media, media, especially publication, published materials, should be conside ...
and
freedom of speech Freedom of speech is a principle that supports the freedom of an individual or a community to articulate their opinions and ideas without fear of retaliation, censorship, or legal sanction. The right to freedom of expression has been recogni ...
. Human rights advocates such as
Human Rights Watch Human Rights Watch (HRW) is an international non-governmental organization, headquartered in New York City, that conducts research and advocacy on human rights. The group pressures governments, policy makers, companies, and individual human r ...
and media groups such as
Reporters Without Borders Reporters Without Borders (RWB; french: Reporters sans frontières; RSF) is an international non-profit and non-governmental organization with the stated aim of safeguarding the right to freedom of information. It describes its advocacy as found ...
speculate that if companies stopped contributing to the authorities' censorship efforts, the government could be pressured to change. Niklas Zennström, then chief executive of Skype, told reporters that its joint venture partner in China was operated in compliance with domestic law. "
TOM Online TOM Online is a mobile Internet company in China, operating the popular Chinese-language Internet portal (www.tom.com) and offering a variety of online and mobile services, including wireless internet and online advertising. It is a subsidiary of ...
had implemented a text filter, which is what everyone else in that market is doing," said Zennström. "Those are the regulations," he said. "I may like or not like the laws and regulations to operate businesses in the UK or Germany or the US, but if I do business there I choose to comply with those laws and regulations. I can try to lobby to change them, but I need to comply with them. China in that way is not different."


France 2005

In September 2005, the French Ministry of Research, acting on advice from the General Secretariat of National Defence, issued an official disapproval of the use of Skype in public research and higher education; some services are interpreting this decision as an outright ban. The exact reasons for the decision were not given.


United States, CALEA 2006

In May 2006, the
Federal Communications Commission The Federal Communications Commission (FCC) is an independent agency of the United States federal government that regulates communications by radio, television, wire, satellite, and cable across the United States. The FCC maintains jurisdiction ...
(FCC) successfully applied the
Communications Assistance for Law Enforcement Act The Communications Assistance for Law Enforcement Act (CALEA), also known as the "Digital Telephony Act," is a United States wiretapping law passed in 1994, during the presidency of Bill Clinton (Pub. L. No. 103-414, 108 Stat. 4279, codified at 47 ...
to allow
wiretapping Telephone tapping (also wire tapping or wiretapping in American English) is the monitoring of telephone and Internet-based conversations by a third party, often by covert means. The wire tap received its name because, historically, the monitorin ...
on digital phone networks. Skype was not compliant with the Act, and stated that it does not plan to comply.


United States, Transparency and PRISM 2013

Starting in November 2010, Skype has been participating in a U.S. Government spy program titled
PRISM Prism usually refers to: * Prism (optics), a transparent optical component with flat surfaces that refract light * Prism (geometry), a kind of polyhedron Prism may also refer to: Science and mathematics * Prism (geology), a type of sedimentary ...
, allowing the
National Security Agency The National Security Agency (NSA) is a national-level intelligence agency of the United States Department of Defense, under the authority of the Director of National Intelligence (DNI). The NSA is responsible for global monitoring, collecti ...
(NSA) unfettered access to people's chats and video and audio communications. However, it was not until February 2011 that the company was formally served with a directive to comply, signed by the attorney general. In March 2013, the company issued transparency reports. confirming long held beliefs that Skype responds to requests from governments. Microsoft's General Counsel wrote to the US Attorney General, outlining the company's concerns in July 2013 in a blog from Brad Smith including a copy of the letter to the US attorney.


See also

* Features of Skype


References


External links


Skype.comSkype learning: pros and cons
{{Microsoft 2005 mergers and acquisitions 2011 mergers and acquisitions EBay Microsoft acquisitions Microsoft subsidiaries Microsoft divisions Skype Skype people Software companies of Luxembourg VoIP companies 2003 establishments in Luxembourg Software companies established in 2003 Companies based in Luxembourg City