After kickstarting the market for making calls over the internet 23 years ago, Skype is closing down. Microsoft, which acquired the messaging and calling app 14 years ago, said it will be retiring it from active duty on May 5 to double down on Teams. Skype users have 10 weeks to decide what they want to do with their account.
It’s not clear how many people are impacted. The most recent numbers that Microsoft had shared were in 2023, when it said it had more than 36 million users — a long way from Skype’s peak of 300 million users.
“We know this is a big deal for our Skype users, and we’re very grateful for their support of Skype and all the learnings that have factored into Teams over the last seven years,” Jeff Teper, president of Microsoft 365 collaborative Apps and platforms, told TechCrunch in an interview this week. “At this point, putting all our focus behind Teams will let us give a simpler message and drive faster innovation.”
Between now and May 5, users will have the option to migrate all their contacts and chat data over to Microsoft’s Teams platform. Alternatively, users can download their Skype data using the app’s built-in export tool.
The business case
The news will come as little surprise to those who have followed Skype in recent years; and in many ways, the writing has been on the wall since 2016, when Microsoft debuted Teams.
While Microsoft had launched a specific Skype for Business product in 2015, Teams’ arrival signalled a new direction for Microsoft in the cloud communications space. Many likened Teams to a Slack clone, but the bigger ambition was to build a platform that would give space for collaboration and communication across a wide range of Microsoft and other apps, and that included video and text chatting — a direct overlap with Skype.
Microsoft then revealed plans to phase out Skype for Business in 2017, concluding those efforts four years later, in 2021. That same year, Microsoft selected Teams as the integrated communications app of choice on Windows 11, relegating Skype to the sidelines.
Fast forward to December 2024, TechCrunch reported that Microsoft had stopped letting Skype users add credit to their accounts, or buy Skype phone numbers, pushing users to monthly subscriptions and Skype-to-phone plans instead.
And so this takes us to today’s news, signalling the end of a brand and company that was one of the first big tech startups to launch out of Europe in the dawdling days of dial-up.
Skype’s death knell comes two years after Microsoft started rolling out an entirely rebuilt, rearchitected Teams desktop and web app. In those two years, Teper says consumer calling minutes in Teams has grown four-fold, though he declined to say how many consumers make up its 320 million user-base.
“It’s at a high-enough scale that we feel great about the app [Teams] for personal use,” Teper said. “We feel we have the mileage under our belt on the adoption by consumers, [who are] using Teams in their personal lives. We’ve thought about [shutting down Skype] for a while, but we really felt like the product had to show the end-user adoption with consumers telling us it was ready.”
And Microsoft believes that consumers are now ready.
User numbers
While Skype ushered in a new era of internet-based communication, starting with voice before expanding to video and file-sharing, the arrival of smartphones and a swathe of new messaging apps have taken a toll on Skype’s user count through the years. For context, WhatsApp sailed past 2 billion users in 2020.
When Skype filed for an IPO in 2010, it revealed 560 million registered users and 124 million monthly active users. But rather than going public in the wake of its spin-off from eBay (which had acquired it in 2005), Microsoft tabled a $8.5 billion bid for Skype in 2011, and grew the platform to a peak of 300 million users in 2013.
Microsoft hasn’t made a habit of breaking out Skype user numbers in subsequent years, though it has teased the occasional data point. At the start of the pandemic in March, 2020, the company revealed that Skype had grown 70% month-on-month to 40 million daily users, as people sought ways to stay in touch with loved ones during lockdown — a trend that generated similar surges in rival platforms such as Zoom.
The most recent update Microsoft provided was via a blog post published in early 2023 announcing an integration between Skype and its Bing search engine, where it revealed that “more than 36 million people use Skype daily to connect through phone calls and chats” globally.
The long and short of this, though, is that Teams’ growth and Skype’s flatlining is one reason Microsoft reckons now is a good time to go all-in on Teams.
“Skype took a bump — as did Teams — during the pandemic, and Skype has largely been pretty stable in the last couple of years,” Teper said. “And we felt the time, and the feedback, was such that we could make the move.”
Phone home
Microsoft is encouraging users to move over Teams Free. This offers some additional features not available in Skype, such as calendar integrations, but Teams Free lacks other key features that were hallmarks of Skype — specifically, phone-calling functionality that allowed users to call mobile and landline numbers, as well as receive phone calls with a Skype phone number.
Microsoft began depreciating these services back in December, preventing users from adding any further credit to their accounts while also putting a halt on buying Skype numbers. Users were still able to make calls to phone numbers with a valid monthly subscription or any remaining credit they had, but the subscription renewals will come to an end on April 3.
For legacy users who still have credit in their accounts, Microsoft will be making a Skype Dial Pad available both in the Skype web portal and in Teams for an indefinite period.
“We’ll support [this] as long as users have credit and they’re using this functionality,” Microsoft VP of product Amit Fulay told TechCrunch.
Despite the enterprise incarnation of Teams offering phone-calling functionality, Fulay confirmed that Teams Free won’t support PSTN (public switched telephone network) services, mostly because of shifting consumer trends.
“We’ve been looking at usage of telephony for a while on Skype, and patterns have changed, usage has changed, and this is a step towards that,” he said. “People have mobile data plans, and when this [telephony] functionality came out many years ago, that wasn’t the case.”
System migration
During the transition period, Skype users will be able to download the Teams app and log-in with their Skype credentials, with all their chats and contacts migrating over automatically. The Skype app itself will continue to work in tandem, through May 5, 2025.
Alternatively, users will be able to export their data, though in reality there likely isn’t all that much they’ll be able to do with it in terms of importing it anywhere else.
“We wanted to make sure that during this transition, people aren’t losing their contacts, their memories,” Fulay said. “We want to make sure we preserve all the things people have shared. And if they choose to come to Teams, we’ll restore all of their contacts and data.”
If a user takes no action by May 5, Skype says it will retain user data until the end of the year, after which it will be deleted.
Blurred lines
One of the big takeaways from all this is how the lines between the business and consumer realms have blurred, due in part to societal norms around technology and trends such as remote work.
Skype began as a consumer product that spread into the business sphere, while Teams began as a business product that segued into consumer. Teams today, though, still feels like a business product, particularly due to its name. Do families and friends really see themselves as part of one big “team”?
Teper, for his part, doesn’t see this as a problem, given that many of its existing products already transcend use-case boundaries.
“I think a lot of people will make the transition [from Skype to Teams],” he said. “If you think about Word, Excel, PowerPoint, those are brands that work for business and personal use for people. We have kids and parents doing their homework in Word, and budgets and Excel, so we have good precedent about our tools being used in personal and work life.”
#Microsoft #hangs #Skype #service #shut