For Microsoft Corporation, Skype Is Serious Business

Two years and $8.5 billion later, Microsoft’s Skype bid is looking smarter.

Tim Beyers
Tim Beyers
Apr 9, 2014 at 5:29PM
Technology and Telecom

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.