Millennials, pour one out for a digital pioneer.
Microsoft announced Friday it will be “retiring” Skype in May, nearly 22 years after the web-based phone and video calling service launched ― and helped popularize the idea of free, internet-based calls.
Current Skype users will be encouraged to migrate their data to Microsoft Teams, which has many of the same core features. Skype will officially sunset on May 5.
Microsoft Collaborative Apps and Platforms President Jeff Teper confirmed the news in a blog post, couching it in corporate speak as an attempt “to streamline our free consumer communications offerings so we can more easily adapt to customer needs.”
Teper acknowledged in a conversation with The Verge that Skype has struggled to compete with more contemporary video chat and communication services like FaceTime and WhatsApp.
A botched Skype redesign in 2017 that attempted to make the app more like Snapchat didn’t help. And Skype failed to seize the moment when COVID-19 shutdowns hit, instead ceding ground to Zoom, which remains a corporate go-to.
“The Skype userbase actually grew at the beginning of the pandemic, and has been pretty flat since,” Teper told the tech outlet. “It’s not shrunk in some dramatic way. It has been relatively flat over the last few years.”
Skype exploded in popularity after its 2003 launch by Janus Friis and Niklas Zennström in Estonia. (The two previously founded Kazaa, another formative Millennial app.)
EBay acquired the company for $2.6 billion in 2005, envisioning that video calls would help buyers and sellers more quickly transact. But despite Skype’s continued growth, it never became a core part of the auction site.
Instead, eBay ultimately sold Skype (which was then partially owned by an investor group) off to Microsoft for $8.5 billion in 2011.
Microsoft’s CEO at the time, Steve Ballmer, predicted the union would attract “hundreds of millions or, as [Skype CEO Tony Bates] said, billions of consumers and empower them to communicate in new and interesting ways.”
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The prediction fell flat. By 2023, Skype had around 36 million daily active users, down from 40 million three years earlier amid the pandemic.