Skype To Buy GroupMe for $85 Million, but Is It Too Little Too Late?

By: Hillel Fuld

If there is one thing Skype is not missing, it is publicity. With over 700 million users, frequent updates, and weekly news stories, there is never a dull moment with the VoIP king. Having said that, there is something about Skype as a company that consistently causes them to drag their feet and move slower than they need to be moving in the fast-paced technology and mobile industries.

Take Fring for example. A small company that was very much dependent on Skype before it was banned, seems to be out-innovating Skype on almost every front. What do I mean? Here are a few examples of features that Skype either released later than its competition or has not released till today:

• Mobile Video Calling
• Native iPad App
• Group Video Chat
• Cross Platform Support
• Availability on All Carriers

The latest news from Skype is the $85 million acquisition of GroupMe, an application that was launched at TechCrunch Disrupt a year ago and facilitates cross platform messaging among groups of people. So why did Skype buy GroupMe?

According to Om Malik, Skype realized that in today’s hyper-connected world, as he calls it, users are not satisfied with standard IM, voice, or video calling and service providers have to capitalize on the ability to truly engage their audience. To be honest, I am not sure I agree 100%. What can be more engaging than talking to someone across the world face to face on a video call with superb and real life-like audio and video?

Putting that debate aside, the name of the game today is group interaction. Fring knows it, Google knows it, and GroupMe knows it. Skype wants in on that game, but acquiring GroupMe, that specializes in group text and not (yet) group audio or video, was not the right move for Skype. In fact, this deal confuses me on a whole different level.  Why couldn’t Skype develop this technology on its own? I mean, money clearly isn’t an issue.

There is, however, another side to this coin and it is called Windows Phone. There is much speculation about what Microsoft intends to do with its new $8.5 billion property, but most experts agree that Windows Phone will have some sort of nifty deep integration of Skype’s VoIP infrastructure. If you take a quick look at the mobile OS landscape (what is left of it after this week), you will notice that almost all the different platforms have their own propriotary messaging system.

The pioneer is of course RIM with its hit messaging service BBM, but iOS followed with iMessage, and Android is right behind them. But what about Windows Phone? After the recent acquisition of Motorola by Google, many Android partners are starting to consider Windows Phone as their platform of choice. One of them even admitted this publicly.

Of course for Windows Phone to become a true contender, Microsoft is going to have to step up its game. Although, Mango is a huge step in the right direction. Perhaps this Skype acquisition of GroupMe is not intended to compete with Fring’s group video chat, Google’s Hangouts, or any other video chat solution. Perhaps it is Skype’s way of bringing more to the table in the upcoming Microsoft acquisition and it is Skype telling Microsoft that their $8.5 billion was spent wisely.

One thing is for sure, if Skype wants to maintain its dominance in this hot space of VoIP solutions, it is going to have to start innovating like it did before it became a large corporate entity with a pending multi billion dollar acquisition. Of course mobile should be on the forefront of its priorities, but I don’t think anyone would object if Skype hired a UI expert to revamp their desktop apps, and Skype, if you are reading, here is a pointer, start with your Mac application.

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