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Article from GigaOm.

“Microsoft confirmed that it has agreed to buy Skype for $8.5 billion and plans to integrate it into a wide array of products, from Kinect and Windows Phone 7 to Lync, Outlook and Xbox Live. The deal caps a sudden turn of events for Skype, which had previously been the target of interest from Google and Facebook, but then attracted attention from Microsoft. Om first broke the news about Microsoft’s interest in Skype, and last night nailed the purchase price. With the deal, Microsoft is taking a product that eBay couldn’t integrate well and will try and use it to compete against Google, Apple, Cisco and others in the collaboration and communications space.

Microsoft said Skype will become a new business division with Skype CEO Tony Bates assuming the title of president of the Microsoft Skype Division. The company said the acquisition will enhance its work in real-time communications, which includes Lync, Outlook, Messenger, Hotmail and Xbox LIVE. And it expects it to bring in new revenue and provide more benefits to both consumers and enterprise customers.

“Skype is a phenomenal service that is loved by millions of people around the world,” said Microsoft CEO Steve Ballmer in a statement. “Together we will create the future of real-time communications so people can easily stay connected to family, friends, clients and colleagues anywhere in the world.”

For Skype, the deal allows it to extend its reach and introduce new ways to communicate, said Bates. Microsoft said Skype currently has 170 million connected users and logged more than 207 billion minutes of voice and video conversations in 2010. For all its popularity, however, Skype has had trouble making money and posted a $7 million net loss in 2010.

Microsoft will have a big job on its hands in trying to make Skype work — in part because at $8.5 billion, it is Redmond’s biggest acquisition ever. As Om points out, Skype could give Microsoft a boost in the collaboration market and improve its Windows Phone 7 offering. It could also be an intriguing video-calling combination for Kinect, the gesture-based system for the Xbox. But big acquisitions also have a history of failure, so it remains to be seen whether Microsoft has the ability to turn Skype into a money maker — especially considering its other online efforts haven’t seen much success.”

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Here is an interresting article from SFgate.com.

“Microsoft is betting the cloud will deliver it and its customers the most opportunities for innovation and development. And according to CEO Steve Ballmer, five key reasons are driving the company’s confidence in — and technology strategy for — cloud computing in the coming years.

Microsoft’s 2010 task: Make the cloud clear

“For the cloud, we’re all in,” said Ballmer during an address and live Webcast at the University of Washington’s Paul G. Allen Center for Computer Science & Engineering in Seattle. “Literally, I will tell you we are betting our company on it.”

In addition to Microsoft’s Azure platform, Ballmer said the cloud and its potential is behind Microsoft’s technology strategy and that the company, while perhaps behind in some areas such as phones, is with the market leaders when it comes to cloud computing.

“The cloud fuels Microsoft and Microsoft fuels the cloud,” Ballmer said. “We have 40,000 people employed building software around the globe, about 70% of the folks that work for us are doing something designed exclusively for the cloud or designed to serve one of the five points I spoke about today. A year from now, it would be 90%. How we are thinking about delivering it really builds from this cloud base.”

During the hour-long address, Ballmer detailed the five key dimensions of the cloud driving Microsoft, the first being that “the cloud creates opportunities and responsibilities.” That means it provides people the opportunity to create and share content “instantaneously,” but also requires a responsibility around privacy and confidentiality. “It is a dimension of the cloud that needs all of our best work in my opinion,” Ballmer said.

The second key dimension is around learning, what the cloud learns about the world and about users, bringing data together to enable better decisions.

But the cloud, like many disruptive technologies, is not a static entity, he suggested. “The cloud needs to learn about you and needs to keep learning and figure out about the world that has been described virtually,” Ballmer said. “The cloud itself needs to learn, it has to represent the real world and keep getting smarter and better to help me learn.”

The next dimension Ballmer detailed involves how the cloud “enhances your social and professional interactions” and enables people to connect on multi-faceted levels.

“The ability to really connect people and help people connect is just beginning to be tapped,” Ballmer said.

Using an example of Xbox Live tapping into British television service Sky, Simon Atwell, senior program manager at Microsoft’s XBox division, showed how users could virtually watch TV together, interact via prompts and connect socially using the gaming platform, without actually having to be playing games the entire time. While the demonstration suffered from “4,700 miles of geographic latency,” Atwell was able to display the experience in part.”

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Here is a good weekend article around youth online behaviours well worth a reading. The SF Chronichle article points out that Twitter has failed to catch up among the young, Myspace invites for blogging in contrary to Facebook that is more of a staus/ short message socializing forum.

Questions that I get from this is how to reach the youth with businessmodels, enabling profits, advertising etc. Also, if the lifecycles of products are as shorts as a few years, what happens with existing, but declining businesses?

Gerbsman Partners are able to provide leadership in this questions, please contact us for more information.

“Teenagers and young adults spent less time blogging during the past three years as social networks like Facebook became more popular, according to a Pew Research Center study released Wednesday.

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