Microsoft And Skype Essay

3380 words - 14 pages

Skype’s acquisition by Microsoft --- a strategic decision??

Microsoft- Company history & current situation:
Microsoft Corporation is one of the largest software companies in the world which is headquartered at Washington, USA with annual revenues in excess of $50 billion. The company's core business is based on developing, manufacturing, and licensing software products, including operating systems, software development tools business and consumer applications, server applications as well as Internet software technologies, and services. Microsoft was founded in late 1970’s by Bill Gates & Paul Allen who sold BASIC, the first computer language program to MITS computers, their first customer. In 1981 Microsoft, Inc. was incorporated & sold software to IBM, the dominant mainframe company. From 1983, Microsoft was led by Bill Gates; Chairman of Microsoft & one the world's wealthiest individuals and most famous businessman. Microsoft has succeeded in placing at least one of its products on virtually every PC in the world, setting industry standards and defining markets in the process. Microsoft worked closely with Apple during the development of Apple's Macintosh computer, which was introduced in the year 1984. Revolutionary in its design, Mac featured a graphical user interface based on icons instead of the typed commands used by the IBM PC. This made its programs simple easy to learn and simple to use, even by computer novices. Microsoft introduced Mac version of Word, BASIC and the spreadsheet program Multiplan, which quickly made Microsoft the leading supplier of applications for the Mac. Revenues jumped from $50 million in 1983 to nearly $100 million in 1984 (James 2004). Bill Gates & his colleagues moved from a company based on business opportunities to one which had real competitive strengths through a combination of chance, leadership & astute strategic insight.

The company has diversified in recent years into the video game industry with the Xbox and its successor, the Xbox 360 as well as into the consumer electronics and digital services market with MSN, Zune and the Windows Phone Operating System. However, Microsoft has faced failure in dominate mobile markets as well as failed in the music and entertainment industries, also. They have no app store, or even app based lightweight devices and Operating System like Android and Apple (Pratt 2011). They have never been a leader in either web based search, or advertising. Again, they are perceived as the aging tech dinosaur because the only thing they still dominate at is desktop computing (which also seems to be quietly and quickly going away). Microsoft's track record of buyout fiascos, resulting in failure after failure, speaks for itself. When we look back over the past acquisitions, it makes us think that Bill Gates, in particular, was a philanthropist much longer than he's given credit for (Dvorak 2011). Microsoft has acquired various companies and products during its...

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