May 11

With tech companies amassing ever larger hordes of cash, there are increasing temptations to spend it. In the iOS market there have been several acquisitions lately. (Here’s a list of iOS related acquisitions that I’ve been compiling over time.) But the whopper of all transactions must be the $8.5 billion cash purchase of Skype that Microsoft announced yesterday.

You’ve got to admire the Skype founders deal prowess. First selling their company to eBay for $2.6B, a price that was generally criticized as being to high, leading eBay to later write down the assets by more than a billion. Then participating in a group of investors who bought a majority of the company back from eBay (at a substantially lower price). Again a deal that was roundly criticized as being risky. And now flipping the company to Microsoft for $8.5B. For all the criticism of eBay, they sure know a thing or two about buying and selling – they made two billion and change on the deals.

So what does this have to do with iOS development?

Let’s look at what Microsoft is planning to do with Skype. One idea that has been brought forth is to deeply integrate Skype into Windows Phone 7 to compete with Google Voice on Android and Apple’s Facetime on iOS. But Skype has to be anathema to the AT&Ts and Verizons of the world. I can’t think of any technology/company that has cost phone companies more in lost revenue than Skype. So when Microsoft and their OEMs come to a mobile operator and asks them to sell their fledgling Windows Phone 7 devices, will having Skype deeply integrated into the OS really help them? (It’s probably not a coincidence that Google Voice is not preinstalled on Android devices.) But I guess Microsoft still has plenty of cash available to grease the tracks for deals…

Microsoft has a history of providing lots of APIs to developers. So maybe they will create an OS level API for apps to access Skype. Imagine if your app could easily make VoIP and video calls via the vast Skype network as well as to regular phones. I have lots of ideas of how I would use that in our apps. That’s why I have been asking Apple to create an API for Facetime. Hopefully competitive pressure might entice Apple to do this sooner.

Finally, let’s hope that Apple uses their mountain of cash more wisely.

written by Nick \\ tags:

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