For Microsoft Corporation, Skype Is Serious Business

Microsoft's (NASDAQ: MSFT  ) Skype is getting a big upgrade amid threats to both Windows and Office. Fool contributor Tim Beyers explains the implications in the following video.  

Earlier this week, Microsoft unveiled Skype TX for professional broadcasters. The idea is to appeal to those in the production business by offering a more robust version of the VoiP platform that Mr. Softy acquired for $8.5 billion in 2011.

How robust? TX is designed for high-quality remote broadcast, and as such, supports HD-SDI video input and output, eliminates ads and notifications, and autocorrects aspect ratios for cleaner streaming. Microsoft plans to sell TX as part of the Skype in Media bundle, though pricing is unknown at this point.

What we do know is that voice, video, and messaging software is becoming more strategic to Microsoft's business. Specifically, Skype pairs with the company's "Lync" platform to form a unified communications offering for businesses. Sales of Lync products grew 25% in the fiscal second quarter.

For now, that's still a small part of the business. And yet the governing segment -- Server and Tools -- is growing in importance with each passing year. Tim says a heavy focus on Skype and related big-ticket, transformative products could push the division to new highs.

Do you agree? Are you using Microsoft's Skype? Please watch the video to get the full story and then leave a comment to let us know your take, including whether you would buy, sell, or short Microsoft stock at current prices.

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Comments from our Foolish Readers

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  • Report this Comment On April 09, 2014, at 11:09 PM, mikelee1973 wrote:

    I stopped reading after "the VoiP platform that Mr. Softy acquired". "The term "Mr. Softy" seems to indicate a clear dislike or disrespect for the company you are writing about. This being the case, should I be expected to read the entire article?

  • Report this Comment On April 09, 2014, at 11:44 PM, why wrote:

    Why is MSFT still targeting enterprise customers while the explosive growth is in consumer space? With millions of Skype customers they could easily compete with whatsapp if they have the right features

  • Report this Comment On April 10, 2014, at 7:48 AM, butthead2u wrote:

    In my opinion it's normally much better to target enterprise customers first with a high quality product that the industry is willing to pay for as opposed to targeting the large consumer segment who is not willing to pay for the services. The high quality service will then enentually trickle down to the consumer segment.

    In this case, they are actually targeting both enterprise and consumers for skype, it's just a matter of time until enough services and premium features are added to Skype to draw the masses in.

    They're using the same approach for the ecosystem that they did for Windows/Office.

  • Report this Comment On April 10, 2014, at 9:45 AM, TMFMileHigh wrote:

    @mikelee1973,

    >>"The term "Mr. Softy" seems to indicate a clear dislike or disrespect for the company you are writing about. This being the case, should I be expected to read the entire article?

    That's your choice and I'm not in the business of arm-twisting. All I'll say is that "Mr. Softy" is a term I use to mix it up -- mostly, because I like it -- and no different than the times I refer to Apple as the "iEmpire."

    Foolish best,

    Tim

    --

    TMFMileHigh in CAPS and on the boards

    @milehighfool on Twitter

    http://about.me/timbeyers

    http://timbeyers.me

  • Report this Comment On April 16, 2014, at 12:46 AM, coffeeaddict wrote:

    Too bad MS hasn't done jack in terms of adding features to the free skype since they bought the damn thing.

    Also the Win 8 app is horrible. It barely has any of the features the desktop app has. No settings, nothing. It's terrible. It's like they started the app and only got 1/3 way through it or something. How they felt the could push that to production is beyond me..shows poorly on them.

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