End of Era as Skype Makes its Final Call in May 2025

1

Microsoft has promised to make the transition of Skype users to Teams easier.

When Skype was announced on August 29, 2003, internet calling was expensive, and VoIP, or voice-over-internet protocol, was not familiar to the general public.

Slowly, Skype calls took over, changing the game of online communication. Like Google was for online searching, Skype became for online calls.

Today, May 5, around 22 years later, the company makes its last call as Microsoft folds it into its Teams service.

The end of Skype was yet another tragedy, falling victim to ruthless competition in the era of technology.

Before, to make calls, one would need a SIM card, but that was no longer necessary after VoIP and Skype, which required only an internet connection.

Before becoming what it is now, Skype had several names. Initially, it was Skype Peer-to-Peer, then Skyper, and finally, it dropped the “r” to make use of domains that were accessible at the time.

Estonians Toivo Annus, Ahti Heinla, Priit Kasesalu, and Jaan Tallinn developed its software, while Swede Niklas Zennström and Dane Janus Friis created its parent company.

The platform quickly became famous for offering free voice calls to phone numbers between its users and those who paid for them. Its position in the internet communication became cemented when it added video calls in 2006 on Windows.

Users even used it in their contact information, like email signatures and business cards, as its popularity skyrocketed.

The company started as a start-up and raised $76.85 million across five funding rounds between 2003 and 2010, starting with $250,000 and reaching a peak of $50 million.

Its first ownership change was in 2005, when e-commerce giant eBay purchased it for $2.5 billion.

It turned out to be a bad idea since eBay lost millions of dollars after buying Skype, as it was frustrating its customers with ads. Then eBay sold 70% of its shares to Silver Lake Partners, which later faced a lawsuit from its founders over intellectual property copyrights.

The unexpected event happened when the company went public in 2010 and raised $1 billion. Rumours say that Facebook and Google bid $4 billion for Skype, but Microsoft jumped to buy it in 2011 for $8.5 billion.

During its prime, the online call company had almost 300 million users. Like how the internet made it popular, the same competition on the World Wide Web caused its downfall.

Microsoft, which had long dominated the world of technology, was suddenly facing competition from Apple’s comeback and Google’s rise, which were both influenced by shifting consumer and computer tastes.

Even while Microsoft tried holding its ground by stepping up its cloud and services offerings, acquiring the online call company would allow it to capitalise on the expanding communication market.

Microsoft released Teams in 2017, although it was unclear at the time if Teams was to replace or compete with Skype (both platforms had distinctive features).

Teams offered up to 10,000 users and other sophisticated features like enterprise-grade security, while Skype was intended for home and small business users and could accommodate up to 20 users.

In February, Microsoft announced the layoffs of Skype. At this point, it was not in its prime since it was declining due to other platforms like Google Meet, Apple FaceTime, Facebook’s WhatsApp, and Zoom.

The latest figures as of 2023 showed that Skype users have gone down to 36 million.

According to Microsoft, folding it was done to simplify the free consumer communications services and make it easier to adjust to the demands of our users. Team’s customers will still be able to use many of its features.

Microsoft has promised to make the transition of Skype users to Teams easier. But the distinctive song would ring in the minds of people who witnessed what could be regarded as the start of mainstream video conferencing.