The Skype logo is seen above the company´s stand at the Mobile World Congress in Barcelona, Spain, in this Feb.16, 2011 photo. Microsoft could by Skype, the Wall Street Journal says. Bloomberg photo
Microsoft is nearing a deal to buy the popular Internet telephone service Skype in what could be the biggest deal in the software maker´s 36-year history, according to a published report.
If Microsoft does buy Skype, The Wall Street Journal reported that the deal could be valued at $8.5 billion, including assumed debt. At that price, a Skype takeover would top Microsoft´s biggest previous acquisition - a $6 billion purchase of the online ad service aQuantive in 2007.
Buying Skype would give Microsoft a potentially valuable communications tool as it tries to make a bigger splash on the Internet and become a bigger force in the increasingly important smartphone market.
Skype boasts about 663 million users worldwide who make voice and video calls over the Internet. The amount of calling on Skype´s network totaled 207 billion minutes last year, according to regulatory documents.
Most people use Skype´s free calling services, a penchant that has made it difficult for the service to make money since entrepreneurs Niklas Zennstrom and Janus Friis started the Luxembourg company in 2003.
Skype lost $7 million on revenue of $860 million last year, according to papers that the company has filed since announcing its intentions last summer to launch an initial public offering of stock. The IPO, however, has been in a holding pattern. An average of about 8.8 million customers per month pay to use Skype services.
Although it makes billions from its computer software, Microsoft has been accustomed to losing money on the Internet in a mostly futile attempt to catch up to Google in the online search market. Microsoft got so desperate that it made a $47.5 billion bid to buy Yahoo three years ago, but withdrew the offer after Yahoo balked.