Skype announces it is shutting down in May

Skype will ring for the last time on May 5 as owner Microsoft retires the two-decade-old internet calling service that redefined how people connect across borders.

Shutting down Skype will help Microsoft (MSFT.O), opens new tab focus on its homegrown Teams service by simplifying its communication offerings, the software giant said on Friday.

Founded in 2003, Skype’s audio and video calls quickly disrupted the landline industry in the early 2000s and made the company a household name boasting hundreds of millions of users at its peak. But the platform has struggled to keep up with easier-to-use and more reliable rivals such as Zoom and Salesforce’s Slack in recent years.

The decline was partly because Skype’s underlying technology was not suited for the smartphone era.

When the pandemic and work-from-home fueled the need for online business calls, Microsoft batted for Teams by aggressively integrating it with other Office apps to tap corporate users — once a major base for Skype.

To ease the transition from the platform, its users will be able to log into Teams for free on any supported device using their existing credentials, with chats and contacts migrating automatically.

With that, Skype will become the latest in a series of high-flying bets that Microsoft has mishandled, such as the Internet Explorer web browser and its Windows Phone. Other big tech firms have also struggled with online communication tools, with Google making several attempts through apps including Hangouts and Duo.

Microsoft declined to share the latest user figures for Skype and said there would be no job cuts due to the move. It added that Teams has about 320 million monthly active users.

When Microsoft bought Skype in 2011 for $8.5 billion after outbidding Google and Facebook — its largest deal at the time — the service had around 150 million monthly users; by 2020, that number had fallen to roughly 23 million, despite a brief resurgence during the pandemic.

Microsoft said on Friday “Skype has been an integral part of shaping modern communications”.