European Commission approves Microsoft's $8.5-bn acquisition of Skype

10 Oct 2011

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The European Commission over the weekend approved Microsoft's $8.5-billion acquisition of voice and video communication provider Skype, thus removing the last hurdle for Microsoft's biggest-ever acquisition.

The EU approval came after the US regulator had approved the deal in July

The 27-nation European Commission said, "the deal would not significantly impede effective competition in the European Economic Area (The EU plus Iceland, Lichtenstein and Norway) or any substantial part of it."

The Brussels-based regulator said that in the area of consumer communications, the investigation found that the parties' activities mainly overlap for video communications, where Microsoft is active through its Windows Live Messenger. However, the Commission found that there are no competition concerns in this growing market where numerous players, including Google, are present.

For enterprise communications, the Commission said that Skype has a limited market presence for these products and does not compete directly with Microsoft's enterprise communication product Lync, which is used mostly by large enterprises.

Microsoft, in May, announced plans to acquire Skype and integrate its products and technologies with Microsoft software portfolio. It also plans to create a Skype division, led by Skype's current CEO Tony Bates. (See: Microsoft acquiring Skype for $8.5 bn)

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