The Rise and Fall of Microsoft's Skype (cnbc.com) 93
CNBC has created a 15-minute video titled "The Rise and Fall of Skype," telling the story of how Skype was developed in just nine months in 2003 by a six-person group of childhood friends in Estonia. "We were smart engineers," says Skype's former chief technical architect Ahti Heinla. "We learned on the go. None of us had any telecoms background." But at the end of the interview, he concedes "I myself use Skype right now fairly little. I still have it installed on my phone, but my primary communication methods now are elsewhere."
GigaOm founder Om Malik tells CNBC it was Skype's missteps that enabled the massive growth of WhatsApp, and shared this succinct diagnosis of what's happening to Skype. "Microsoft is where consumer brands go to die." From an accompanying article on CNBC's web site: In 2005 eBay bought it. That deal didn't work out as planned, and an investor group led by Silver Lake purchased a majority stake. Microsoft then stepped in, shelling out $8.5 billion for the company in 2011. Even backed by the world's largest software company, Skype is falling by the wayside. During the pandemic, consumers and business workers turned to tools like Zoom and Meta's WhatsApp, and now there are any number of options to quickly connect with groups of friends and colleagues over smartphones... Microsoft has promoted Skype in Outlook and Windows and even enriched the app with its Bing generative artificial intelligence chatbot. But the numbers still don't look great.
In March 2020, Microsoft said Skype had 40 million daily active users, a number that's since slipped to 36 million, according to a spokesperson. Microsoft's newer Teams communication app, by contrast, is growing in popularity, rising from nearly 250 million monthly users in July 2021 to a record of over 300 million in the first quarter.
Microsoft Teams reached an all-time high of 300 million active users in the second quarter of 2023, according to CNBC's video report. But a research VP at International Data Corp says Microsoft Teams was successful — in taking users away from Skype.
GigaOm's Malik says Microsoft "failed to capitalize on Skype, 100%. Steve Balmer was the king of buying things and not knowing what to do with them... What happened with Skype is the story of every large company with a lot of middle management: they didn't innovate on the product for a very long time."
Jordan Novet from CNBC Business News calls Skype "a product with an uncertain future," arguing that Microsoft "is pouring a lot of engineering resources into making Teams a big destination for communication. It's not doing the same thing with Skype." Could Skype make a comeback? "Anything is possible," Novet concedes. "Microsoft is trying to make Skype happen in a bigger way now." He points out that Skype is now equipped with Bing's AI-powered chatbot, so "You can talk to Bing in Skype. Will that make Skype explode in popularity, or make a comeback? I don't think so."
Microsoft's current head of Skype was not available for CNBC's video. But as a kind of epilogue, they report that Jaan Tallinn, one of Skype's original programmers, now "spends most of his time discussing the dangers of unchecked AI development."
"I don't know what the future holds for Skype..." he tells CNBC. "I'm concerned about humans being wiped out, so it's unlikely that we'll need Skype if that happens."
GigaOm founder Om Malik tells CNBC it was Skype's missteps that enabled the massive growth of WhatsApp, and shared this succinct diagnosis of what's happening to Skype. "Microsoft is where consumer brands go to die." From an accompanying article on CNBC's web site: In 2005 eBay bought it. That deal didn't work out as planned, and an investor group led by Silver Lake purchased a majority stake. Microsoft then stepped in, shelling out $8.5 billion for the company in 2011. Even backed by the world's largest software company, Skype is falling by the wayside. During the pandemic, consumers and business workers turned to tools like Zoom and Meta's WhatsApp, and now there are any number of options to quickly connect with groups of friends and colleagues over smartphones... Microsoft has promoted Skype in Outlook and Windows and even enriched the app with its Bing generative artificial intelligence chatbot. But the numbers still don't look great.
In March 2020, Microsoft said Skype had 40 million daily active users, a number that's since slipped to 36 million, according to a spokesperson. Microsoft's newer Teams communication app, by contrast, is growing in popularity, rising from nearly 250 million monthly users in July 2021 to a record of over 300 million in the first quarter.
Microsoft Teams reached an all-time high of 300 million active users in the second quarter of 2023, according to CNBC's video report. But a research VP at International Data Corp says Microsoft Teams was successful — in taking users away from Skype.
GigaOm's Malik says Microsoft "failed to capitalize on Skype, 100%. Steve Balmer was the king of buying things and not knowing what to do with them... What happened with Skype is the story of every large company with a lot of middle management: they didn't innovate on the product for a very long time."
Jordan Novet from CNBC Business News calls Skype "a product with an uncertain future," arguing that Microsoft "is pouring a lot of engineering resources into making Teams a big destination for communication. It's not doing the same thing with Skype." Could Skype make a comeback? "Anything is possible," Novet concedes. "Microsoft is trying to make Skype happen in a bigger way now." He points out that Skype is now equipped with Bing's AI-powered chatbot, so "You can talk to Bing in Skype. Will that make Skype explode in popularity, or make a comeback? I don't think so."
Microsoft's current head of Skype was not available for CNBC's video. But as a kind of epilogue, they report that Jaan Tallinn, one of Skype's original programmers, now "spends most of his time discussing the dangers of unchecked AI development."
"I don't know what the future holds for Skype..." he tells CNBC. "I'm concerned about humans being wiped out, so it's unlikely that we'll need Skype if that happens."
Bought by the government (Score:4, Interesting)
The reason is, it was bought by the government to disable the decentralized call routing feature.
They were asked to implement CALEA wiretapping and wouldnt. So microsoft air quote, bought them, and the first change was to route calls through a centralized system.
This is all about wire, tapping, and had nothing to do about anything else.
Re:Bought by the government (Score:5, Insightful)
Ubiquitous NAT and widespread CGNAT killed the distributed call routing. Lots of users would be unable to connect directly to each other, so you end up with the call routed through a third party who could be anywhere and have all kinds of latency/jitter problems. Routing through centralised servers is not quite as bad since MS can afford to have enough servers in enough locations.
The point of the distributed call routing was to reduce costs for skype, as they didn't have the resources MS do to host centralised servers.
Re: (Score:3)
When Microsoft bought Skype, everything was working fine. People liked Skype because it just worked. It dealt with all those adversities. Admins did not like Skype, because of how effectively it pierced through firewalls. Then came Microsoft, and the changes they made actually caused problems for users at first.
I'm not sure if Microsoft was asked to buy Skype in order to deal with the decentralized nature of Skype at the time, or if they bought it because Microsoft is notoriously bad at building anything th
Re:Bought by the government (Score:4, Informative)
Skype never "worked fine". While I found it useful when it worked, it could be notoriously bad for audio quality and latency. I don't know if that was how it was routing packets but I could certainly see how quality of service could improve with some dedicated servers and backbones.
Re:Bought by the government (Score:5, Interesting)
Back in 2006-2010 when I was either living in China or working from overseas with teams in China, Skype was the only really reliable tool, whether it was Skype-to-Skype or Skype-to-phone. It was the only tool that could cope with varying and often high latency as well as the connection resets that the Great Firewall of China introduced. It became unreliable when Microsoft started routing everything through their servers. We carried in using it at work up until the company switched to Slack because it was still better than crap like Office Communicator/Lync/Skype for Business.
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The one thing I continue to use Skype for it calls to phones in other countries. I haven't looked recently, but it used to be the cheapest way to call overseas.
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My personal Skype account has about £3 on it, and my work one about £12. I last added credit in about 2011, and just have to reactivate it every six months. I guess I don't make Skype to phone calls very often anymore! There was a time too that you could call US national toll free numbers for free from overseas, so long as you hadn't assigned a UK phone number (I haven't tried recently so I don't know whether it's still possible). I suppose these days international phone rates are
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When Microsoft bought Skype, everything was working fine.
Stop trying to rewrite history. When Microsoft bought Skype the number one google result for any search related to Skype was universally articles about improving the shit video quality, which was largely caused by the centralised call routing system they had in place at the time. I've seen multiple magazine articles on this issue at the time. Magazines, someone thought this topic was of interest enough to write it down, print it on paper, bind it on the left and side and sell this information to people, tha
Re: Bought by the government (Score:1)
Re:Bought by the government (Score:4, Insightful)
The weird part is that I remember going to IETF meetings circa 2010-2012, and one of the points in presentations (that eventually got published as RFC 6586 https://datatracker.ietf.org/d... [ietf.org] ) was that if you are running IPv6-only network (with access to IPv4 Internet via NAT64 gateway), then Skype was one of the few apps that did *not* work, probably precisely because it made some assumptions about the underlying network. And it did not have IPv6 support at the time. So the application that most definitely would have benefited from NATless network (IPv6), did not even bother to support it properly...
Re: (Score:2, Troll)
Untrue. These are solved problems. Sure, you need some trickery, but it is not black magic.
The NAT issue is just a pretext (i.e. "lie") used to justify central call routing.
Here is a starting point: https://en.wikipedia.org/wiki/... [wikipedia.org]
Here is a somewhat in-dept explanation for a specific approach: https://tailscale.com/blog/how... [tailscale.com]
Re: Bought by the government (Score:1, Insightful)
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You seems to be deep in delusion. Do not mistake your non-understanding of my comments as a sure indicator of a problem on my side. It is not.
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Well, I guess you are an useful idiot then. Because you do not seem to be smart enough to actually get paid for your attempts to police opinions you do not like.
I would also like to point out that /. has _moderation_. You may want to think about why I post (and have always posted after the first 2 weeks or so) at 2, unlike you.
Re: Bought by the government (Score:1)
Re: (Score:2)
No, you cannot. Because you do not know how to tell the difference.
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And in actual reality, you are merely describing yourself. How quaint.
Comment removed (Score:5, Insightful)
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It's not a lie,
It is at the very least a lie by omission. Sure, NAT is a problem. But you can a) try to make it work anyways especially as some people were able to or b) just give up early because you actually do not want it to work and that central surveillance hub sounds just dandy.
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The Wikipedia article is so expansive in what it terms "NAT transversal" it even lists SOCKS as a method.
To say nothing of the fact that several of these listed features barely had RFCs published by the time Microsoft bought them and actual end user implementation of NAT traversal in the 00s was utter limited garbage, and that limited garbage was often recommended to be disabled at the router as a security concern (UPnP had a bad run in the 00s).
Re:Bought by the government (Score:5, Informative)
The reason is, it was bought by the government to disable the decentralized call routing feature. They were asked to implement CALEA wiretapping and wouldnt. So microsoft air quote, bought them, and the first change was to route calls through a centralized system.
Nice conspiracy theory. Now back in reality Skype had centralised call routing as a fallback method long before Microsoft bought them. Every man and their dog setting up NAT at home broke the decentralised functionality of Skype. By the time Microosft came along nearly all calls on Skype were already centrally routed by necessity. They simply disabled a borderline unused feature.
This is all about wire, tapping, and had nothing to do about anything else.
No. This is about Slashdot changing over time from a place where sensible technical discussions took place to a place where wild conspiracies are blurted out that don't even fit the historical timeline correctly.
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The other reason was some patent troll went after Microsoft on Skype's decentralized technology so Microsoft simply removed it. It's the reason why Apple broke FaceTime because it too was p2p based but Apple also got sued by patent trolls.
So decentralized was on its way out, and patent trolls just encouraged companies to put it down even quicker.
Re: (Score:2)
The NAT argument is not true. https://en.wikipedia.org/wiki/... [wikipedia.org]
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The NAT argument is not true. https://en.wikipedia.org/wiki/... [wikipedia.org]
It's funny you link an article as if it's some kind of reference while it doesn't actually mention anything at all about the topic. Or are you trying to imply that NAT has the features listed in the article? Maybe if I send you a Wikipedia page to AMD's Zen4 architecture will you magically believe that your PC had PCI-Express 4 in 2005?
Many of the modern features of NAT traversal didn't become widespread well until the past decade. Heck Skype didn't even support basic UPnP until very shortly before Microsof
Re: (Score:2)
Well, as usual, you demonstrate how clueless you are. The NAT problem of P2P communication is what "NAT traversal" solves. There are numerous concrete techniques and literature references on the page and it talks exactly about the question at hand. In fact, "peer-to-peer file sharing" and "voice over IP" are listet at the very top as possible applications. And some of the techniques referenced do _not_ need any support from the NAT device. But I guess that flies right over your head, as usual.
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No you're just Dunning-Krugering so hard you didn't even read my post. Hint: At no point did I say NAT traversal doesn't solve the problem. Try reading my post again when you sober up.
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You did essentially claim that the very wikipedia article about NAT traversal does not mention NAT traversal....
Are you going into dementia or something?
Re:Bought by the government (Score:5, Informative)
Re: (Score:2)
Not true: https://en.wikipedia.org/wiki/... [wikipedia.org]
There may have been other problems, but how to get P2P through two NAT gateways facing the opposite direction has been solved more than 20 years ago.
It is _no_ surprise that some tech is not very good and that Microsoft usually is unable or unwilling to make things better.
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No. I think that if there are documented solutions to problem X, claiming that problem X is what killed something needs at the very least more of an explanation than "problem X killed it".
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You just accused him of dishonesty.
Yes, I did. Because it is accurate.
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It's worse than that. The "solutions" that gweihir in his infinite ignorance is saying were solved 20 years ago were not actually in common use in consumer gear 20 years ago. What he thinks we had a solution for is utterly irrelevant.
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Indeed. Surveillance fascists doing their evil work.
Re: Bought by the government (Score:1)
Re: (Score:2)
That is a problem on your side. If you chose to support evil, you will get comments like that. And that is entirely your fault.
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The reason is, it was bought by the government to disable the decentralized call routing feature.
They were asked to implement CALEA wiretapping and wouldnt. So microsoft air quote, bought them, and the first change was to route calls through a centralized system.
This is all about wire, tapping, and had nothing to do about anything else.
Citation?
It's Lync's fault as much as anything (Score:2)
Microsloth bought Skype, and applied it's good name to the streaming pile of horseshit called Lync.
Sure, name something everyone hates after something everyone loves (and they did, at the time). That'll work out just great across the board.
Re:It's Lync's fault as much as anything (Score:4, Insightful)
Yeah, remember how they rebranded Lync "Skype for Business", which even after lots of work was only partially compatible with regular Skype?
Raise your hand if your workplace ever had a remote interview scheduled where everyone at your company's end was on Skype for Business (and in multiple offices), the remote person was on regular Skype, your IT group gets pulled in five minutes after the interview was supposed to start and ends up running around like a chicken with its head cut off, trying to get everyone moved to a new impromptu regular Skype session.
(Side note: how can so many STEM faculty be so technically illiterate? Not at MY place, of course, no sir Mr. Chair if you're hanging out on Slashdot for some reason...)
Re: It's Lync's fault as much as anything (Score:2)
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Microsloth bought Skype, and applied it's good name to the streaming pile of horseshit called Lync.
Oh god the flashbacks :(
I had the um pleasure of encountering Lync first during a contracting gig. Fully remote work so I had to rely on it heavily. Just so awful.
Re: (Score:2)
they didn't innovate on the product for a very long time.
But they did innovate! They innovated in fucking it up. They took a product that more or less owned the marketplace to the point where, like Hoover, it was almost genericised, and just kept fucking it up more and more, over and over again, until it had faded into irrelevance.
It takes a lot to go from complete market dominance to complete irrelevance, but if anyone can manage that, Microsoft (and possibly Musk) can.
Gradient background (Score:3)
I used skype until they decided gradient fill was more important than readable text. Uninstalled it from my phone which forced others to find alternatives to reach me.
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Uninstalled it from my phone which forced others to find alternatives to reach me.
My my aren't we a self righteous arsehole. I get what you're saying, but unlike you I don't feel gradient fill is any reason to be a burden on others or communication.
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Nice troll, but keep your slave mentality to yourself.
"Microsoft is where consumer brands go to die." (Score:5, Funny)
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IBM enters the chat...
Also entering this chat, Corel!
If you did any sort of home/enthusiast multimedia production in the 90's or 2000s, you used either WinDVD [windvdpro.com], Roxio [roxio.com] (or its Adaptec ancestor Easy CD Creator which they later bought; Roxio also bought Sonic RecordNOW and DVD Studio, itself acquired from Veritas), Pinnacle Studio [pinnaclesys.com], which was a bit better known for their analog video capture cards including the Dazzle line, CorelDRAW [coreldraw.com], admittedly a first-party application that Quark/Illustrator/Indesign folks either loved or hated, Wo [wordperfect.com]
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lol @ that last bit (Score:2)
> . "I'm concerned about humans being wiped out,
I'm really not. Not just because AI as it stands today is nothing more than fancy statistical analysis with no accuracy. But also because humanity is the biggest blight on the universe and deserves to go extinct, so the rest of life on earth can do its thing.
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Wasnâ(TM)t Skype cannibalised for Teams? (Score:1)
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I had assumed that Microsoft bought Skype and used its libraries and developers to built Teams. Was that a complete misunderstanding - and if thatâ(TM)s not what happened, why the heck not??
My understanding is no. MS bought Skype and after many iterations rewrote it to be more compatible with their software as well as being entirely centralized. But by that time, they had lost most of the users present at the time of purchase. Then MS continued to modify it to where no one used it. Then they renamed it and incorporated it into Teams as no one was using Teams.
Skype at purchase was heavily reliant on p2p in design. That meant it was somewhat more reliable in certain situations and less reliable
Not sure, but ... (Score:5, Insightful)
Wouldn't it be more accurate to say, "The rise of Skype and fall of Microsoft Skype"?
Re: (Score:2)
The rise of which Skype? When did it become popular? Who killed it? Who added to it? It was bought and sold several times over its existence.
All Microsoft did for Skype... (Score:2)
... that i noticed ... ... was to replace the native cllient with a "modern" Electron abomination with less features, more CPU consumption and that never syncs properly across devices.
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No kidding - man, Teams really sucks big time!
Oh, wait, you were talking about Skype...
MS Teams is based on Skype (Score:2)
The entire voice stack of Teams is all Skype.
MS just doesn't do well with consumer apps but they are still quite successful with B2B.
I am hardly a fan of MS, but this article seems too myopic.
Re: (Score:2)
To be fair to the article, just because they reused the technology doesn't change the point. Skype is borderline dead in the consumer space, and Teams was a stillbirth even as they shoehorned it into Windows 11 and flashed it in everyone's face.
Everyone I know uses Windows 11. Zero percent of them use Teams outside their workplace. WhatsApp, Messenger, I'm sure apple has something as well, video chatting is now ubiquitous and Microsoft has in the consumer space had as much success with it as they have the Z
Re: MS Teams is based on Skype (Score:2)
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IMHO MS is just not a company that knows or even should try to cater to consumers.
Most people like to keep work and private life separate. Teams does nicely for work, and outside of it there are myriad other options for voice and video chats.
Skype is dead (Score:3)
Over 20 years ago I remember the triumph of getting my iPaq to connect to a hotel wifi in Bali and being able to call Ireland for pennies per minute. All thanks to Skype. It became indispensable for travel over the next 10 years. It didn't always work but when it did, it was worth it over the bullshit of calling cards and suchlike.
But then smart phones happened and apps like Whatsapp, Viber, Signal etc. Assuming the person you were calling had the app too then you could talk for free. And roaming got cheaper too and you could buy SIMs and dual SIM phones. So the whole point of Skype kind of disappeared. I'm sure it still has edge cases for people who need telephone numbers or whatnot but I stopped using it and I'm sure usage as slumped.
That doesn't stop Microsoft dumping Skype on Windows 11 without asking, or preinstalled on some phones. I bet it hasn't helped make it more popular though.
Re: Skype is dead (Score:1)
> But then smart phones happened and apps like Whatsapp, Viber, Signal etc. Assuming the person you were calling had the app too then you could talk for free.
What are the improvements of those to Skype? Skype has been on smartphones for donkeys years and works multiplatform, including on the Web.
I really don't understand the popularity of whatsapp, and find it annoying that its web app doesn't do audio/video. Iinm, Whatsapp doesn't even work on ipad, properly. What gives? Skype is so much better.
I recall
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Other apps started as (reliable) text messaging apps that added voice and video features later (FB Messenger, Google Hangouts, WhatsApp). Skype started the other way round.
Add network effects to that and there you go.
Convenience is what killed Skype. Nobody wants to juggle 5 types of apps for each purpose (text messaging, voice calls, video calls, image sharing, file transfers). Other apps were better at doing most
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Interesting. That's not my experience, at all.
I've always had success with Skype, and the fact that I only need one 'app' for all platforms and features makes it a lot more convenient.
That WhatsApp doesn't have any solution for ipad or laptop makes it almost useless to me. It's very disappointing. It's the same with WeChat - they used to have a web app for just text chat, but they don't even have that any more. At least WhatsApp have a text chat for laptops. Skype, of course, has text, audio and video on al
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Skype just seemed antiquated last time I used it. Especially compared to Viber which I used for a while - Viber just integrated with the phone dialler and contacts so it was like making and receiving calls the normal way. Skype didn't and kind of lived in its own little world. Maybe it has changed since but this was what it was like at the time. And then the wife & her social group used Whatsapp and people work used it I dumped Viber and moved to that. It's all mindshare with these apps and if Whatsapp
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There were even people selling landline home phones with a Skype button on them - so you could carry on calling grandma, for pennies. Skype was very early, even before smart phones - but it was actually making it pretty well. Microsoft bought it, and essentially did nothing with it for about 10 years (yeah, I know Lync, Skype for Business and the other franken-products they made, but none of those really went anywhere).
Had Skype carried on trying to make it big, it's likely they'd have made a smart phone ap
user interface (Score:2)
I worked at Skype (Score:5, Interesting)
Re: (Score:1)
So I stopped using Skype.
I also remember MSN Messenger and actually preferred it for chat (since you could use your own custom animated emojis) but Microsoft killed that.
Skype? Teams? Yuck. (Score:2)
I still regard the (now very dead) MICE tools as superior in terms of quality and in terms of the number of people you could have on a call without causing issues.
Skype is better. (Score:1)
Imo, skype is still better than the alternatives. With skype, I can text, video, audio on any platform I want and it works great. I can also call locally from any country, and freephone numbers for free... and set my phone number to look like my real number.
I really don't get why whatsapp is so popular. Skype is much better.
User interface (Score:3)
Plus, Skype never really worked correctly for me when I logged in on more than one device. I got missed messages and calls, and in the end I simply asked people to contact me by other means.
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Of course after MS bought it the Linux interface stopped working, which was, of course, predictable.
Opus (Score:2)
40 million to 36 million is "dying"? (Score:2)
It's certainly not thriving, but a 10% decrease in users doesn't seem quite like "death" to me.
Skype (Score:2)
It's not that Microsoft can't successfully promote (Score:2)
Clearly, Microsoft knows how to promote a product, including chat software. In just a couple of years, Teams has gone from nonexistent, to a product used in businesses everywhere. This is despite a dumb product name.
Microsoft is more interested in business customers, than individuals, because they get a LOT more money from businesses. Yes, I know Skype is/was also used by businesses. But Skype's strength was always text chat. MS wanted to build a platform that was designed from the ground up to run meetings
Skype for business doesn't need the cloud (Score:1)
user (Score:2)
I have used Skype a lot to chat with family, especially during covid. The family wanted to move to whatsapp but I baulked at giving whatsapp access to all my contacts.
What annoys me about skype is that it is so hard to use - my family may not be the most tech savvy but they're not dimwits and setting up the weekend group call always ran into snags.
And what's with Skype's obsession with being impossible to quit ? I just want it to run when I need it and then close completely when I don't
Good times! (Score:2)
I remember when Microsoft bought them, followed by the service getting worse and a new update introduceing a ton of problems just to underline the point! ðY£
I don't think so (Score:2)
The only two major issues that I can think of are the following:
Firstly, "new" IMs required nothing but a phone number to sign up while Skype to this day still requires a valid account which is a lot more cumbersome and time consuming to create.
Secondly, new IMs siphoned your contact list and Microsoft continued to insist on privacy - and you had to add contacts manually which is
Such potential for it too. (Score:2)
Microsoft had their change with Skype to integrate it into the Xbox Live world, add a camera, and absolutely dominate the space that we thought that FaceTime was going to rule.
They seemed *so close* but never quite got across the finish line with Skype. Now with so many other apps making data calls, it seems almost pointless., which is sad.
The best thing Microsoft did for Skype was .. Wise (Score:2)
The best thing Microsoft did for Skype was buy it. Skype was first, but there are lots of very capable replacements now so M$ turning it into crap is not such a big loss. If you want "rock solid and just work (in the west anyway)" go with Facebook or Google. If you want "secure", go with Signal. I have no idea why anybody would go with Microsoft skype or teams (or outlook) - the number of bugs, outages, and UI quirks in Microsoft products just floors me.
In buying Skype, Microsoft freed a couple of very