Microsoft and Skype - Could Be A Good Thing

By now everyone has heard of Microsoft purchasing Skype. In this particular case Microsoft has a very good high level idea of what to do with the service in terms of offering IP-based calling for their Xbox Live, Windows Phone 7, and other devices. Additionally Skype will continue to support other platforms that will insure their current customers are happy while at the same time offering some new opportunities for Microsoft.

From a high-level strategic viewpoint, this makes quite a lot of sense for both companies. However in my opinion Microsoft could really use Skype to make a lot of it's various products more consumer friendly. Let's just focus on the mobile space for a brief moment. Apple's Facetime and Google's GoogleVoice are significant and powerful services that continue to threaten the established mobile service providers. Basically they are beginning to challenge the fundamentals of the carriers in communications. If you can actually have face-to-face or similar communication services simply over mobile data networks or high speed networks such as WiFi, then why pay the extra services from your local telecom company? Now from a more practical approach, such a move is obviously years away, yet the growing interest by consumers in such technologies such as Skype is obviously something that companies that want to be a part of the ongoing mobile discussion over the next 10 years are looking into. As a younger audience begins to embrace these technologies they are creating a demand that the more established players have not had to deal with and are currently struggling to address.

Microsoft has had quite a few successes recently with their products: Xbox and Xbox Live, Kinect, Bing and arguably Windows Phone 7. However these advances appear on the surface to be promoted and conceived from more creative and flexible units such as Microsoft Gaming and not the main corporate core which has been their Operating System and Office Units. From merely an objective viewpoint, the sheer reluctance to integrate these platforms with comparative services points to a significant hesitation on Microsoft's part. However with the acquisition of Skype it is clear that Microsoft does in fact realize the potential opportunities that they have at their fingertips. With their purchase, Microsoft can create a very strong cross-platform, voice and video communication offering for their customers.

I would like to point out that I am not a strong proponent of Microsoft products. I think that for a number of years they have languished, becoming significantly out of touch with their an increasingly sophisticated customer base that has rewarded more nimble, innovative and just plain better customer-friendly competitors such as Apple and Google. However that does not mean that Microsoft is not capable of adjusting. Yet being the company of one of the best-selling consumer products, a la the Kinect, has only minimally been addressed by Microsoft. In fact the more interesting possibilities seem to be coming from the Kinect hacks where independent developers inspired by the device have started to create their own ecosystem. While it is true Microsoft has mentioned that they intend to fully produce and support a similar idea in their own way, it is not really clear to myself that they are fully committed to the idea. I use Apple as sort of measuring stick in adjusting to "surprise" hits of their products. The App Store started as an experiment a little after a year they realized that their iPhone was doing so well. So it is not quite a year yet for the Kinect, so Microsoft has time to adjust.

With so many promising recent evolutions and entries, I am sort of surprised to see Microsoft being so slow to capitalize on the momentum they have gained. The long wait times and independent efforts tend to show more of a company in conflict with itself or taking too long to respond to market demands. So while I applaud the move by Microsoft in acquiring Skype and understand some of the great opportunities it represents, the pessimist is taking a "wait and see" sort of attitude to the whole affair. With so many great opportunities to move forward, Microsoft seems to be taking far too long to move which in my opinion ultimately impact how customers respond to their products.