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article imageMicrosoft scores FTC approval, Skype fires senior executives

By Justin Crann     Jun 19, 2011 in Business
Washington - A little over a month after announcing they were buying Skype, Microsoft has overcome a considerable hurdle by securing the approval of the Federal Trade Commission.
An announcement of antitrust approval for the Microsoft-Skype deal was issued by the FTC on June 16, Reuters reported. FTC approval was a major obstacle Microsoft needed to overcome to close the blockbuster US$8.5 billion deal for the voice-over-IP service.
As previously reported by Digital Journal, Microsoft made the $8.5B purchase of Skype — the most expensive acquisition in its history — with the intent to "enhance its portfolio of real time communication products and services."
The purchase of Skype will help to fulfill this goal, as it brings Microsoft's total instant messaging market share to 68 per cent, according to data published in a report from software manageability firm OPSWAT.
Skype Firing Key Executives
Only three days after earning approval on the deal, Bloomberg reported that Skype was firing several senior executives in order to reduce the cost of payouts that would need to be made when the deal finalizes.
Many of the fired executives, including Vice Presidents David Gurle, Christopher Dean and Don Albert, were instrumental in marketing the VOIP service and forging key partnerships with other businesses, including Facebook.
The Deal: Good or Bad?
The Skype buyout has been met with considerable surprise and criticism from market analysts and reporters alike. Commonly cited problems include Microsoft's poor track record with corporate acquisitions and Skype's ongoing struggle to monetize their services, as well as the total cost of the deal.
Others are more optimistic about the deal, including Richard Blackden of the Telegraph, who argues that the deal will "make the next chapter in the battle royal between the software maker and its rivals that much more compelling."
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