Multiple media outlets are reporting on Monday night that Microsoft is poised to announce it's acquiring Skype for approximately $7 billion-$8 billion. (See GigaOm, Wall Street Journal, and All Things Digital). Assuming these reports are accurate, here's some initial reaction on what such a deal might mean in the enterprise communications industry:
Skype's drive to become more of an enterprise player escalated when the company filed for its IPO. In its SEC filings, Skype called out business services as a potential source for expanded revenues that would justify a public offering for a company that had built its success on an unpaid service and software. Skype's strength has always been on the consumer side, so it's conceivable that enterprise services will simply be dwarfed in importance by other factors driving the deal, and Microsoft could simply allow Skype's nascent business focus to wither while it focuses on other strategies for Skype--whether that be as a VOIP service on Windows Mobile or as a pool of millions of worldwide customers to mine for a range of consumer search and social networking offerings.
Microsoft obviously doesn't need to buy Skype to get the fundamental Unified Communications, instant messaging, and video technologies; it has those now with Lync--but Lync is business-focused. Being able to pull some of Skype's hundreds of millions of worldwide users into the embrace of Lync could be a game-changer for Lync, which has been a challenger up to now in the enterprise real-time communications world. However, bringing Skype users under the Lync umbrella would complicate the use of Skype by enterprises that have committed to other enterprise-grade UC platforms, i.e., Cisco, Avaya, et al.
Which brings us to one of the stickier points of a Microsoft acquisition of Skype: Skype's existing partnerships and integrations. Most notable among these is with Avaya, who stands to be a big loser in any Microsoft purchase of Skype.
Avaya has been a key Skype partner, given the fact that both have been partly owned by Silver Lake Partners private equity firm. Last year Avaya announced a major, multi-step integration with SkypeConnect. The partnership calls for tighter integration of Avaya's systems with Skype in the second half of this year, which presumably would be thrown into question by a Microsoft acquisition.
The goal of that integration was, as Zeus Kerravala wrote at the time of the announcement: "The integration will deliver federation between the two companies so users of either Avaya or Skype can collaborate with each other using chat, voice or video."
This kind of federation is exactly what enterprises want to see among all the vendors in this space, but it's hard to believe Avaya (or, for that matter, Microsoft) will want to continue with the existing integration deal if Skype goes to Microsoft. Enterprises might love the idea of Skype as a kind of PSTN for enterprise UC, a common-denominator service that could federate with all the hitherto proprietary vendors; but if those vendors have been unwilling to federate directly with Microsoft in the past (and vice versa), why would anyone expect them to be willing to federate with a Microsoft-owned Skype (and vice versa) in the future? And if Microsoft treats Skype as an extension of Lync and bars federation with other vendors, then as noted above, enterprises might find Skype more problematic. Not that this would stop end users from using Skype in unauthorized deployments a la the "consumerization of IT".
Another Skype for Business partnership, announced by GM David Gurle at Enterprise Connect, was 2011 in March, would offer Citrix's GoToMeeting web conferencing through Skype. Hard to believe that would continue if the Microsoft deal goes through.
That's a quick first take. Before the deal was apparently confirmed Monday night, Dave Michels had already posted on his Pin Drop Soup blog a great analysis of why Microsoft washis candidate for the best Skype suitor. He's got some excellent analysis there.
We'll be following this developing story.
