About two months ago, Microsoft’s corporate VP for Skype, Gurdeep Pall, revealed some big changes projected for Microsoft Lync in the first half of 2015 including a new name – Skype for Business, plus a new user interface and new features. It’s no surprise that Microsoft is making a crucial play to try to capture market share dominance in the burgeoning UC market, which is projected to grow at a CAGR of 14.1% between 2014 and 2019, according to research from ReportsnReports.com. One of the critical questions resellers and end users alike are wondering is how is Microsoft going to pull off merging a consumer app like Skype with a business app like Lync? And, more importantly why?
Extensive User Base and Global Footprint
Before we can answer these questions, we need to take a look back to 2011, the year Microsoft acquired Skype for $8.5 billion in cash, making it Microsoft’s largest purchase ever. Despite the $686 million in long-term debt it had racked up and a previously unsuccessful acquisition by eBay a few years earlier, Microsoft was willing to outbid competitors Google and Facebook to own something none of the industry giants possessed at the time — paying customers on a video platform. Skype had several million users paying for its premium service, and it had a global footprint.
Coming back to the present, Microsoft’s strategy is to merge the popularity and user friendliness of Skype with the functionality of Lync. Put another way, the end state of the Skype for Business client we’re likely going to see is a Lync overhaul of the “behind-the-scenes” Skype engine and probably only a small tweak to the outside appearance i.e. User Interface.
Another move Microsoft has in its favor is the Office 365 platform, which will serve as a soft seller of the soon-to-be-rebranded Skype for Business. Currently, four out of Microsoft’s six Office 365 business bundles include Lync as part of the subscription (e.g. Office 365 Business Essentials and Office 365 Business Premium). In addition to the business app staples like Word, Excel, Access, PowerPoint, and Outlook, business users also get Microsoft’s UC tool, which includes IM, chat, presence, voice and video functionality at no extra charge.
So, is Skype for Business going to be a game changer? It certainly looks that way. But, on the other hand, is it going to become a monopoly? Not by a long shot, for a few key reasons. First, UC is very complicated and there exists a whole spectrum of functionality within the apps I mentioned earlier. Companies like Avaya and Cisco have spent the past 30-plus years developing various telephony features that are well established in the majority of call centers where the highest level of UC functionality is needed. Moreover, when you take into account the introduction of the telephone handset into the end-user workflow 135 years ago, Skype for Business will have an uphill battle in the near term despite all the wonderful changes and advances we’ve seen in IT over the past five years, even with Lync handsets. There is still a large (albeit shrinking) group of people who have yet to become familiar with the benefits of desktop video calls.
Vishal Brown will be addressing this topic at ITEXPO 2015 in Miami during the session, “Working With Skype for Business: The New Communications Paradigm.” Vishal will also participate on the executive panel, “New Game, New Rules: How Startups are Changing Communications.”