After more than two decades as a pioneer in internet communications, Microsoft has announced that Skype will be discontinued on May 5, 2025. The company is directing users to Microsoft Teams, its current collaboration platform that has increasingly taken center stage in Microsoft’s communication strategy.
The Rise and Fall of an Internet Giant
Launched in 2003 by Niklas Zennström and Janus Friis with the help of Estonian developers, Skype quickly revolutionized how people communicated across borders. The service’s name, derived from “Sky peer-to-peer,” reflected its underlying technology that allowed users to make free internet-based calls to other Skype users.
Skype’s trajectory includes several ownership changes. eBay acquired the service in 2005 for $2.6 billion, though the partnership didn’t work out as planned. By 2009, eBay sold its majority stake to an investor group. Microsoft ultimately purchased Skype in 2011 for $8.5 billion—the company’s largest acquisition at the time.
Declining Popularity Amid Changing Landscape
Despite its early dominance, Skype struggled to maintain relevance in a rapidly evolving market. According to information shared with CNN, the pandemic—which dramatically accelerated video conferencing adoption—failed to revitalize Skype in the way it boosted competitors like Zoom, Google Meet, and Cisco WebEx.
The service saw only modest growth during COVID-19 lockdowns, while Teams and other platforms experienced explosive expansion. Microsoft’s data shows that Skype’s user base has continued to decline, dropping to 36 million daily users in 2023 from its pandemic levels.
“We’ve learned a lot from Skype over the years that we’ve put into Teams as we’ve evolved teams over the last seven to eight years,” Jeff Teper, president of Microsoft 365 collaborative apps and platforms, told CNBC. “But we felt like now is the time because we can be simpler for the market, for our customer base, and we can deliver more innovation faster just by being focused on Teams.”
The Microsoft Teams Transition
Microsoft has been gradually shifting its focus to Teams since its launch in 2017. The application has grown substantially, with around 280 million monthly users as of January 2023. In July of that year, Microsoft reported Teams had reached 300 million monthly active users.
The transition plan includes allowing Skype users to log into Teams using their existing Skype credentials. According to Microsoft’s announcement, users will see their existing contacts and chats from Skype in Teams. Alternatively, users can export their Skype data, including contacts, call history, and conversations.
For those with paid Skype services, Microsoft has stated that current subscribers to Skype’s premium service will remain active until the platform’s discontinuation. The company has stopped accepting new sign-ups and noted that the Skype Dial Pad will remain accessible via a web interface and within Teams for those with remaining Skype Credits.
End of an Era in Digital Communication
Skype’s shutdown marks the end of a service that played a significant role in the evolution of digital communication. At its peak in the mid-2000s, Skype was synonymous with internet calling and video chat, offering a revolutionary way to connect across distances without the high costs previously associated with international communication.
The announcement follows a pattern of legacy communication platforms being phased out in recent years. In June 2023, ICQ—another iconic messaging service from the 2000s—shut down after years of declining relevance.
Microsoft’s move also reflects the broader industry trend toward integrated collaboration platforms that combine messaging, calling, file sharing, and application integration in unified ecosystems—a model that Teams, with its deep integration into Microsoft 365, exemplifies.
As the May 5th deadline approaches, the retirement of Skype represents not just a business decision, but the closing chapter of a technology that helped usher in the era of accessible global communication.
