In a bid to energize its online communication services, Microsoft Corporation (Nasdaq: MSFT) announced yesterday (Tuesday) that it has agreed to buy Web phone company Skype Technologies SA for $8.5 billion.
Microsoft said it intends to integrate Skype's technology into several products, including its Xbox game console, its Outlook e-mail program, and its Windows mobile phones. Microsoft will also gain Skype's active user base of 170 million people.
"This could give Microsoft a much-needed kick-start" in telecommunications, Paolo Pescatore, an analyst at CCS Insight inLondon, told Bloomberg News. In voice services, "Skype has certainly set the benchmark and gained a lot of traction."