Microsoft Buys Teleo, Skype's Bubble Starts Deflating

from the deflating-the-skhype dept

Tue, Aug 30th 2005 6:50pm — Mike Masnick

This had been been rumored by Om Malik months ago, but apparently, it's now official that Microsoft is buying Teleo so they'll have their own Skype-like client. Teleo, which only launched a few months back, is practically a carbon copy of Skype, but using SIP support. The company never seemed sure if it wanted to go after the enterprise market or the consumer market, and so it never seemed to get much user traction -- but Microsoft just wants the technology. You can also bet they didn't pay anywhere near the rumored numbers that are being tossed around for Skype. However, now that Microsoft, Google and Yahoo will all have voice components to their IM offerings, it certainly should deflate some of the Skype-hype (which jumped from a $3 billion valuation to a $10 billion valuation last week, according to some journalists who seem to be viewing the world through a very distorted set of glasses). You now have three companies all with billions of dollars and plenty of ancillary products that make plenty of money and can subsidize any voice offering now directly targeted at Skype's market. Yes, Skype has name recognition and some users -- but nothing that can't be made up easily enough with a decent product offering. So, while Skype now is trying to play down the rumors they were for sale -- if they really did have such an outlandish offer on the table, they would have been crazy not to take it.

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