Skype Isn't A Video Platform..

There seems to be some weird conjecture going on around what Microsoft will do with Skype, much of it involving video delivery.

Personally, I think that even some of the major players involved are talking rubbish - Skype's MD was quoted in the newspaper over the weekend highlighting the ability to deliver film trailers as a rationale for the merger. You what ? I own part of a company that does precisely that and, believe me, it's not going to justify a $8.5bn price tag. It's worrying that such hair brained ideas are coming from the company.

Then industry analysts have been commenting about how Skype can be a video platform. Just one work, people - Joost. As I've said for nearly twenty years now, P2P streaming doesn't scale.

However, there are some merits in the merger - Skype understands online billing, social and apps better than Microsoft does, provided they're given the leeway to leverage their knowledge (Microsoft can be a big black hole for acquisitions).

The real problem here is that the Online division of Microsoft (Bing, MSN, etc..) is a slave to the profitable products side of the company, and the gaming division also complicates things.

I have long been of the belief that Microsoft should have been broken up to return value to shareholders, but the online division has never been successful enough for this to be possible.

The company has restructured a couple of times under Ballmer but 'division' seems to remain the operative word.

So, is this a new dawn ?

It has to be - Ballmer has done a good job of looking after the family silver (OS and Office), and making other bits marginally profitable, but he's no Steve Jobs, and despite the phenomenal margins in the business his tenure was looking stagnant.

But don't believe that it's going to change the online video way in any significant shape or form beyond better video conferencing.