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ber 2005 and in april 2009 announced plans to spin it off in a 2010 initial public offering ipo 4 in september 2009 5 silver lake andreessen horowitz and the canada pension plan investment board announced the acquisition of 65 of skype for 1 9 billion from ebay valuing the business at 2 75 billion skype was acquired by microsoft in may 2011 for 8 5 billion 11 7 billion in 2024 as of 2010 skype was available in 27 languages and had 660 million worldwide users an average of over 100 million active each month 6 and had faced challenges to its intellectual property amid political concerns by governments wishing to control telecommunications systems within their borders in february 2025 microsoft announced the shutdown of skype on 5 may 2025 with the company being dissolved along with it 1 7 history edit skype was founded in 2003 by janus friis from denmark and niklas zennström from sweden 8 having its headquarters in luxembourg with offices now in berlin frankfurt tallinn tartu stockholm london palo alto prague 9 and redmond washington the skype software was originally developed by estonians ahti heinla priit kasesalu and jaan tallinn who together with janus friis and niklas zennström were also behind the peer to peer file sharing software kazaa 10 in april 2003 skype com and skype net domain names were registered 11 12 in august 2003 the first public beta version was released one of the initial names for the project was sky peer to peer which was then abbreviated to skyper however some of the domain names associated with skyper were already taken 13 dropping the final r left the current title skype for which domain names were available 14 the skype logo from 2006 to 2012 in september 2005 skypeout was banned in china 15 in october of the same year ebay purchased skype 16 for 2 6 billion 17 in 2011 the ars technica estimated the purchase price at 3 1 billion not 2 6 billion 18 in december 2005 videotelephony was introduced 19 a skype phone manufactured by smc networks c 2006 in april 2006 the number of registered users reached 100 million in october 2006 skype 2 0 for mac was released the first full release of skype with video for macintosh and in december skype announced a new pricing structure with connection fees for all skypeout calls 20 skype 3 0 for windows was released 21 in 2006 a feature called skypecasting was introduced as a beta it allowed recordings of skype voice over ip voice calls and teleconferences to be used as podcasts skypecasting remained in beta until it was discontinued on 1 september 2008 skypecasts hosted public conference calls for up to 100 people at a time unlike ordinary skype p2p conference calls skypecasts supported moderation features suitable for panel discussions lectures and town hall forums skype operated a directory of public skypecasts 22 throughout 2007 updates 3 1 3 2 and 3 5 added new features including skype find skype prime send money which allowed users to send money via paypal from one skype user to another video in mood inclusion of video content in chat call transfer to another person or a group and auto redial skype 2 7 0 49 beta for mac os x released adding availability of contacts in the mac address book to the skype contact list auto redial contact groups public chat creation and an in window volume slider in the call window during several days in august skype users were unable to connect to full skype network in many countries 23 because of a skype system wide crash which was the result of exceptional number of logins after a windows patch reboot patch tuesday 24 in november there was controversy when it was announced that users allocated certain london 020 numbers specifically those beginning 7870 would lose them after negotiations with the provider of this batch of numbers broke down 25 by early 2008 the tumultuous ownership relations between the founders and ebay had resulted in significant leadership churn with a succession of skype presidents including niklas zennström rajiv dutta alex kazim niklas zennström again and henry gomez all holding that title at various points between 2005 and 2007 the business had failed to meet certain earn out targets growth was decelerating product development had slowed significantly and in october 2007 ebay took a 1 4 billion impairment on the value of skype admitting it had overpaid and now valuing the company at about 2 7 billion 26 in october 2008 analysis revealed tom skype the chinese version of skype run by tom online sent content of text messages and encryption keys to monitoring servers 27 two original founders depart new ceo and the ebay years edit for the six months after the departure of zennström and friis michael van swaaij led the company as interim ceo until the appointment of josh silverman in february 2008 28 silverman was widely viewed as bringing in stability to skype after a tumultuous phase that followed the exit of the two skype co founders 29 under silverman s two and a half year tenure the company focused its product efforts around video calling ubiquity gaining high penetration on smartphones pcs tvs and consumer electronic devices building tailored offerings for enterprise customers and diversifying revenue through subscriptions premium accounts and advertising in advancing this strategy skype released many new products substantially revamping its flagship windows software 3 8 4 0 and its macos and linux software while introducing new software products for smartphones and consumer electronics in 2009 skype 4 0 was released featuring full screen high quality video calling 30 the linux client was updated and an iphone application was launched which topped the charts with over 1m downloads in its first two days 31 skype also announced the launch of its software for the android platform 32 during this period skype also discontinued lesser used services such as support for the skype me presence indicator which meant that a user was interested in receiving skype calls from a non contact skype also discontinued its skypecast service without explanation and added internal monthly and daily usage caps on their skypeout subscriptions which had been advertised as unlimited skype also discontinued its dragonfly feature a community generated yellow pages product and other features which were deemed to be under performing or a distraction to management many users and observers had commented on the high rate of dropped calls and the difficulty reconnecting dropped calls updates including versions for the sony psp handheld video game console version 2 0 for linux with support for video conferencing as part of its efforts to diversify revenues skype launched in april 2008 skype for sip a service aimed at business users at that time around 35 per cent of skype s users were business users 33 in targeted premium products to consumers skype launched new monthly premium subscriptions products in may 2010 34 marketing efforts were also revamped with a particular focus on innovative partnerships with tv broadcasters to integrate skype into their programming the oprah winfrey show began using skype regularly to host video calls between winfrey and her viewers at home culminating in a show dedicated exclusively to the wonders of skype where the skype are you aired first in may 2009 35 skype also became commonly used by network news stations around the world as a cost effective replacement for sending satellite trucks and enabling fast response from citizen journalists skype was also integrated into scripted tv programming such as californication and in the seventh season of the u s syndicated version of the british game show who wants to be a millionaire in a new ask the expert video chat lifeline these efforts led to accelerating growth of skype s connected users and paying users and by 2009 skype was adding about 380 000 new users each day 36 by the end of 2009 skype was generating around us 740 million in revenue 37 in january 2010 josh silverman was recognized for his accomplishments at skype by being named first runner up in the techcrunch crunchies award for best ceo beaten only by mark pincus of zynga 38 independence and silver lake edit building on the revitalization which had begun in 2008 ebay announced in april 2009 plans to spin off skype through an initial public offering in 2010 clarification needed 39 40 41 in august joltid ltd filed a motion with the u s securities and exchange commission seeking to terminate a licensing agreement with ebay which allowed ebay and therefore skype to use the peer to peer communications technology on which skype is based if successful this could have caused a shutdown of skype as it existed and made an ipo challenging to execute 42 in september ebay announced the sale of 65 per cent of skype to a consortium of index ventures and silver lake partners 43 early in september skype shut down the extras developer program 44 in november skype settled the joltid litigation and acquired all skype technology in exchange for equity in the company 45 and ebay completed the sale of 70 of skype to a consortium comprising silver lake partners joltid cppib and andreessen horowitz for approximately 2 billion valuing the entire business at us 2 75 billion 46 in may 2010 skype 5 0 beta was released with a capacity to support group video calls involving up to four participants also in may skype released an updated client for the apple iphone that allowed skype calls to be made over a 3g network originally a 3g call subscription plan was to be instituted in 2011 but skype eventually dropped the plan 47 rounding out its ubiquity push skype also announced deep integration of skype software into the ip connected tvs from panasonic samsung and sony 48 in june 2010 following the rapid departure of daniel berg the chief technology officer and then chief development officer madhu yarlagadda mark gillett an operating partner at silver lake partners assumed the role of chief development officer taking responsibility for development of skype s client software cloud services and product management following a period of several months working closely with joshua silverman to drive the transformation of the business and the acceleration of cross platform and mobile product delivery citation needed with its newfound independence and under ownership skype s growth accelerated 49 and by 2010 telegeography estimated that skype accounted for 25 per cent of the world s international calling minutes according to their research the overall international calling market grew a tepid 5 to 6 per cent annually in 2010 skype however has seen a huge uptick in growth particularly in the last two years 50 on 9 august 2010 skype filed with the united states securities and exchange commission sec to raise up to us 100 million in an initial public offering sources reported that the company expected to raise at least us 1 billion 51 in october 2010 skype announced the appointment of tony bates as ceo bates was a senior vp at cisco and was responsible for its multibillion dollar enterprise commercial and small business division 52 on 14 october 2010 skype 5 0 for windows was released with a number of improvements and feature additions including a facebook tab to allow users to sms chat with or call their facebook friends via skype from the news feed 53 the search for skype users option was omitted from this version 54 on 14 january 2011 skype acquired qik a mobile video sharing platform 55 in march 2011 skype named jonathan chadwick as its new chief financial officer and confirmed that mark gillett would serve full time as chief development and operating officer 56 following the departure of chief financial and administrative officer adrian dillon microsoft subsidiary 2011 2025 edit skype lounge at ces 2012 on 10 may 2011 microsoft announced it had agreed to acquire skype for 8 5 billion 57 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 58 it was announced that skype would become a division within microsoft with skype s former ceo tony bates now its president reporting to microsoft ceo steve ballmer 59 the price microsoft agreed to pay for the company is 32 times skype s operating profits 60 according to the financial times this raises fears of a new tech bubble 60 ars technica and the bbc have questioned the value for microsoft in the purchase 61 62 microsoft s acquisition of skype got eu approval on 7 october 2011 63 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 64 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 65 microsoft s new applications and services group led by executive vice president qi lu was to include skype along with bing and microsoft office 66 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 67 mark gillett announced that he would be leaving microsoft to return to silver lake skype logo 2019 2025 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 68 between 2020 and 2023 skype lost daily users mainly to its main competitor zoom 69 70 on 28 february 2025 microsoft announced skype s retirement on 5 may 2025 with microsoft instead focusing on microsoft teams its proprietary videoconferencing software 1 palo alto office edit the skype north american headquarters opened in early 2013 after the design was completed by san francisco architect firm blitz located in palo alto california the space is designed to encourage interaction and spontaneity while also introducing a sense of humor into the workplace fake lawn cushions that look like boulders open spaces and high ceilings accommodate 250 employees in a 5 000 square metres 54 000 ft 2 building the palo alto headquarters also houses a games room complete with a pool table and table football machine the office s silver leed silver certification means that it received between 50 and 59 points for its environmentally friendly construction 71 72 73 legal issues edit p2p licensing dispute lawsuit and ipo edit in its 2008 annual report ebay admitted to an ongoing dispute between it and joltid ltd over the licensing of its peer to peer global index technology in its application 74 it announced that it terminated a standstill agreement allowing either company to sue on 1 april 2009 ebay fi...