Microsoft Unveils Skype Product Plans as Cisco Undermines the Deal

Last year the Federal Trade Commission and the European Commission gave their approval for Microsoft’s acquisition of Skype.  This paves the way for Skype to be integrated into more of Microsoft’s products and services, but it also sets the stage for some serious rivalries.

We’ve seen little product integration since the acquisition last year, but at the Goldman Sachs Technology and Internet Conference, Microsoft CFO Peter Klein discussed how Microsoft will use Skype to unify and extend both its consumer and enterprise portfolios.

“When you think about Skype and when you think about trying to deliver a compelling set of experiences across devices, the most fundamental experience across devices is communications,” Klein stated at the conference.

“Skype extends that across all of our assets, whether it’s with Lync in the enterprise, or with Xbox Live. It’s something that really ties together all of our devices, a scenario that’s as universal as any.”

Enterprise fears Skype war

But as Microfost reveals their plan for Skype, Cisco voiced their concern for approval of the deal.  Cisco sells products and services like video conferencing, video calls and other services similar to what Skype offers, but the big difference is, Cisco is more about selling the hardware while Skype is more about the service, without having to buy any additional tools.

Cisco’s main concern about the Microsoft-Skype collaboration is the possibility of Microsoft monopolizing the VoIP industry by linking Skype to their Lync Enterprise Communications Platform.  According to Cisco, this “could lock-in businesses who want to reach Skype’s 700 million account holders to a Microsoft-only platform.”

“Imagine how difficult it would be if you were limited to calling people who only use the same carrier or if your phone could only call certain brands and not others.  Cisco wants to avoid this future for video communications, and therefore today appealed the European Commission’s approval of the Microsoft/Skype merger to the General Court of the European Union.  Messagenet, a European VoIP service provider, has joined us in the appeal.”

“We did not take this action lightly. We respect the European Commission, and value Microsoft as a customer, supplier, partner, and competitor. Cisco does not oppose the merger, but believes the European Commission should have placed conditions that would ensure greater standards-based interoperability, to avoid any one company from being able to seek to control the future of video communications.”

“This appeal is about one thing only: securing standards-based interoperability in the video calling space. Our goal is to make video calling as easy and seamless as  email is today. Making a video-to-video call should be as easy as dialing a phone number. Today, however, you can’t make seamless video calls from one platform to another, much to the frustration of consumers and business users alike,” Marthin de Beer wrote on Cisco’s blog.

Microsoft responded to Cisco’s appeal stating that, “The European Commission conducted a thorough investigation of the acquisition, in which Cisco actively participated, and approved the deal in a 36-page decision without any conditions.  We’re confident the Commission’s decision will stand up on appeal.”

RELATED:  Reports: Twitter in acquisition talks with Salesforce, Google and others

Looking at Cisco’s plea, the company seems threatened by the possibility that more companies will use Skype and stop buying their hardware.  But Skype doesn’t really need Microsoft to dominate VoIP–this is a matter of product integration.

As video chat and VoIP revel in recent traction, the Skype ecosystem continues to thrive.  ClickDesk revealed their complete integration with Skype to power their multichannel customer support.

“What makes ClickDesk unique is that we are able to offer business of all sizes, a true multichannel customer support solution, helping improve both sales retention and customer service levels. By allowing customer support agents to receive live chat and calls directly over Skype or GTalk, ClickDesk has significantly increased the number of touch points through which your agent can engage with visitors on your website,” says Rocky Gupta, product evangelist at ClickDesk.

Rivals beyond Skype

And it’s not only Skype that Cisco needs to worry about, as more companies that provide VoIP services without needing to buy additional hardware are getting traction.

Last week, Vonage Mobile made it to the top of the list for best business apps for the iPad and Android tablets.  Vonage, one of the largest VoIP providers and an industry pioneer, specifically designed its new app for the enterprise as it offers cheaper international call rates compared to Skype.

Another thing Cisco has to worry about is the collaboration of Alteva, a leading cloud-based Unified Communications solution provider and subsidiary of Warwick Valley Telephone Company (referred to as WVT Communications Group) with Parallels, the hosting and cloud services enablement leader to provide customers access to a turn-key hosted VoIP white label solution dubbed as APS Broadsoft beta program.

The APS BroadSoft beta program is a way to jumpstart the on-boarding of new clients for the Parallels community, and will provide SMB customers with a route to further leverage additional cloud services as part of their growth strategy.

“The Parallels community is already receptive to cloud-based communication solutions, especially with the growing demand for hosted PBX services at smaller businesses,” said Louis Hayner, Chief Sales Officer, Alteva. “Alteva’s hosted VoIP services, delivered through Parallels Automation, will enable SMBs to continue to compete in their market by utilizing technologies from the cloud — something that they have been seeking for a long time.”

Mellisa Tolentino

Staff Writer at SiliconANGLE
Mellisa Tolentino started at SiliconANGLE covering the mobile and social scene. Over the years, her scope expanded to Bitcoin as well as the Internet of Things. SiliconANGLE gave Mellisa her break in writing and it has been an adventure ever since. She’s from the sunny country of Philippines where people always greet you with the warmest smile. If she’s not busy writing, she loves reading, watching TV series and movies, but what she enjoys the most is playing or just chilling on the couch with with her three dogs Ceecee, Ginger, and Rocky.


Join our mailing list to receive the latest news and updates from our team.


Join our mailing list to receive the latest news and updates from our team.


  1. great share.about skype, CISCO…know many new things…<a href=””>VoIP providers</a>

  2. Cisco playing the part of the victim?  Give me a break. No company has so dominated their marketplace over the last 20 years as Cisco. They desperately need the competition to motivate them, especially with respect to enable services for  small businesses, which is decidedly not their focus. Skype, on the other hand, has been anathema in enterprises and thrives in the consumer, small business and entrepreneurial markets. Cisco has poor distribution into those markets, unlike Microsoft. They need to quit whining and get to work creating new products and distribution channels that facilitate service providers offering innovative, reliable and affordable service to SMB’s.

  3.  @Jim McClintock  I agree with what you have said. Competition makes things better for companies and businesses.

  4. On the last section of the article and interestingly Parallels has been invested in by Cisco, so they might feel threatened, but they’ll bounce.

Submit a Comment

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Share This

Share This

Share this post with your friends!