Microsoft Announces Purchase of Skype for $8.5 Billion

On Tuesday, Microsoft confirmed its intention to acquire Internet communications service Skype for $8.5 billion.

On Wall Street this morning, Microsoft declined 1.9% premarket after announcing its most-expensive deal to date and assuring investors that the purchase will benefit a wide array of Microsoft products and services like Xbox, Kinect, and Windows Phone.

“Skype is a phenomenal service that is loved by millions of people around the world,” Microsoft Chief Executive Steve Ballmer stated after the acquisition plan was formally unveiled. “Together we will create the future of real-time communications so people can easily stay connected to family, friends, clients and colleagues anywhere in the world.”

Based on the announced parameters and structure of the deal, Skype will become a new business division within Microsoft. Consequently, Skype CEO Tony Bates will become president of the Microsoft Skype Division, where he will report directly to Ballmer.

‘Microsoft and Skype share the vision of bringing software innovation and products to our customers,” Bates said. “Together, we will be able to accelerate Skype’s plans to extend our global community and introduce new ways for everyone to communicate and collaborate.”

Skype, which was founded in 2003, was acquired six years ago by eBay for $2.6 billion, and once again in 2009 by an investment group led by Silver Lake.