Is Skype Microsoft's PowerPoint part deux?

Verb envy doesn't come cheap

MicroBite Microsoft already owns one verb: "PowerPoint. But it's not a very sexy or exciting verb in today's webby world. So, a few years back, Microsoft began searching for another, one that covers something lots of people do online. But Google already owns that one. But this week, chief exec Steve Ballmer finally got his wish. His company is now the proud owner of a second verb: "Skype".

But Ballmer's verb doesn't come cheap. He paid $8.5bn in cash. Not stock. Cash. That, apparently, is the price among Silicon Valley types for a loss making web telco whose management and VC backers have no clear idea on how to make any money beyond a theory of: "sell more ads".

Was Ballmer "had"? Or does he see something we don't. Microsoft paid $14m in 1987 for Forethought, whose software became PowerPoint. Back then, $14m was a lot for a tiny, privately-held software company in the Pacific North West, but Microsoft was involved in a death match against other makers of personal productivity software running on the PC. Fourteen years later, the competitors' names are footnotes in history, and PowerPoint helps keep Ballmer in silly-looking sweaters. It's sold as part of an Office suite that rakes in $14bn per year.

In this MicroBite, Reg software editor Gavin Clarke and All-About-Microsoft blogger Mary-Jo Foley peek inside the biggest deal in Microsoft's history, a deal that breaks Microsoft's acquisition rules and Windows philosophy. We try our best to understand what Ballmer is thinking and what it really means.

Also in this edition: Microsoft has tapped one of the creators of .NET to lead Microsoft's effort to rally developers onto its Azure cloud. Can we expect more technology brilliance or have we already seen what Microsoft has to offer? And where oh where are those big-ass cloud appliances promised last year from Dell, Hewlett-Packard, and Fujitsu? Perhaps we'll find out at Microsoft's TechEd show in Atlanta.

As ever, you can listen via The Reg's player, or by downloading the MP3 here or Ogg Vorbis here. ®

Microbite