End of an era: Microsoft to retire Skype after nearly two decades. Here’s why

Big tech giant Microsoft Corp. has decided to retire the online video conferencing platform Skype after a two-decade run as the tech major is set to focus more on the firm's Microsoft Teams services, reported the news agency Reuters on Friday, February 28. 

According to the news agency's report, the company is set to stop offering Skype services on May 5, 2025. Skype is software that connects millions of people across the world through the Internet.

“We are honored to have been part of the journey,” said Microsoft on Friday, cited the news agency. The Big Tech firm also highlighting how Skype has been integral to shaping modern communication.

The Skype-run

Skype was founded in the year 2003 and was an industry mover shifting people from telephone to the internet using audio and video calls. The company soon became a household name as millions of users around the world started shifting into the new interface. 

Skype is a free-for-user service which helps connect people. However, the platform has certain premium features which help people and even help companies bring their entire workplace together on one platform.

According to the agency report, the platform has recently faced tough competition from industry rivals like Zoom and Salesforce's Slack and is struggling to keep up with them.

The report also cited that Skype's downfall is, to an extent, due to the underlying technology behind the platform, which is not suitable for the smartphone era. 

Microsoft promoted teams aggressively integrating it with other Office apps which were aimed to attract corporate users during the global pandemic, which resulted in eating into Skype's market share, according to the agency report.

What should Skyper users do?

To help users ease the transition, Microsoft said that the users will be able to log into Microsoft Teams for free on any supported device using their existing Skype credentials. The chats and the contracts will be migrated automatically between the two platforms, as per the agency report.

Microsoft's Skype move comes across as the biggest move since shutting down the web browser Internet Explorer and the phone band Windows Phone, according to the report.

The big tech firm has refused to share the latest total user figure and has also said that this closure will not result in job cuts. Microsoft Teams has nearly 320 million monthly active users, according to the agency report.

Microsoft bought Skype for $8.5 billion in 2011 after defeating Google and Facebook in a bidding round. Skype had nearly 150 million monthly users, but by 2020, the number dropped to 23 million.

Microsoft shares dropped at Wall Street open on Friday, February 28. Shares recovered from the early trading lows, currently down 0.14 per cent at $392 at 10:55 a.m. (EST), compared to $392.53 at the previous stock market close.