page_title: Skype Technologies
section_title: Microsoft subsidiary (2011–present)
hierarchical_section_title: Skype Technologies / History / Microsoft subsidiary (2011–present)
caption_attribution_description: photo 2012 Pop Culture Geek taken by Doug Kline If you're interested in higher resolution versions of my images, contact me via my profile page.
context_page_description: Skype Technologies S.A.R.L is a telecommunications company headquartered in Luxembourg City, Luxembourg and Palo Alto, CA, United States, whose chief business is the manufacturing and marketing of the video chat and instant messaging computer software program Skype, and various Internet telephony services associated with it. Microsoft purchased the company in 2011, and it has since then operated as their wholly owned subsidiary; as of 2016, it is operating as part of Microsoft's Office Product Group. The company is a Société à responsabilité limitée, or SARL, equivalent to an American limited liability company.
  Skype, a voice over IP service, was first released in 2003 as a way to make free computer-to-computer calls, or reduced-rate calls from a computer to telephones. Support for paid services such as calling landline/mobile phones from Skype, allowing landline/mobile phones to call Skype, and voice messaging generates the majority of Skype's revenue.
  eBay acquired Skype Technologies S.A. in September 2005 and in April 2009 announced plans to spin it off in a 2010 Initial Public Offering.
context_section_description: On 10 May 2011, Microsoft announced it had agreed to acquire Skype for $8.5 billion. This marked a 300% increase in value for the company in the three years since the eBay write-down in October 2007. This constitutes Microsoft's second largest acquisition to date. It was announced that Skype will become a division within Microsoft, with Skype's former CEO Tony Bates —now its president— reporting to Microsoft CEO Steve Ballmer. The price Microsoft agreed to pay for the company is 32 times Skype's operating profits. According to the Financial Times this raises fears of a new "tech bubble". Ars Technica and the BBC have questioned the value for Microsoft in the purchase. Microsoft's acquisition of Skype got EU approval on 7 October 2011.
  In October 2012, one year after the closure of the Skype acquisition, the newly formed Skype Division took responsibility for Microsoft's other VoIP and Unified Communications product Microsoft Lync.
  On 11 July 2013, Microsoft's then-CEO Steve Ballmer announced a reorganization of Microsoft along functional lines and with four engineering groups each led by a senior leader. Microsoft's new Applications and Services Group, led by executive vice president Qi Lu was to include Skype along with Bing and Microsoft Office.  Following a period where the strategy for the Skype business as a part of the broader Microsoft portfolios including Office 365 was established, and Skype's share of the international communications market rose to 36 percent (over 214 billion minutes), Mark Gillett announced that he would be leaving Microsoft to return to Silver Lake.
  In September 2016, after Qi Lu stepped down from Microsoft, Skype and Office became part of the Office Product Group, led by Rajesh Jha. The other part of the former Apps and Services Group (which includes Bing) became part of a new AI and Research Group.
caption: Skype lounge at CES 2012
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