Why and When Microsoft Teams is Replacing Skype

‍Skype for Business will be retired on July 31, 2020.

History of Skype

Skype literally means Sky Peer-to-Peer. Created in Europe, Skype was first released in 2003. Dane Janus Friis and Swede Niklas Zennstrom all played key roles, with help from Estonians Ahti Heinla, Priit Kaesalu, and Jaan Tallinn who worked on music sharing application Kazaa.

With microphone, video, and instant messaging all integrated, Skype quickly grew into a trendy business application with long-term value across the world.

How Skype Works: Strengths & Weaknesses

Skype has endured because of its many strengths. On Skype, up to 50 users can join with the “Meet Now” web interface – making it a powerful web conference tool as well as a videophone.

It’s considered very user-friendly, strongly integrated with over 800 apps, and free to other Skype users.

After the launch of Microsoft Teams in 2017, Skype became fully integrated with Office 365 – Word, Excel, PowerPoint, OneNote and more. This connection to Microsoft Teams – and thus Office 365 - is Skype’s greatest advantage, making it a platform that can easily integrate with tools that your business likely is already using.

Skype pricing model

Skype uses a freemium model. Skype to Skype is free, while charges accrue to calls placed to landlines.

In 2005, eBay acquired Skype for $2.5 billion. An investment groupled by Andreesen Horowitz bought 65% of Skype from eBay for $1.9 billion in 2009.

In 2009, Microsoft bought Skype for $8.5 billion. Microsoft incorporated Skype as its own division based in Luxembourg and Estonia.

Microsoft reconfigured Skype clients from peer-to-peer (P2P) to Azure over 2016-17.

Skype Weaknesses

Skype’s weaknesses include a tendency to crash, overlap with evolving functions in Teams, and a years-long saga of issues with security and privacy. Serious, longstanding questions persist about privacy – from the Free Software Foundation, ACLU, Electronic Frontier Foundation, and others.

Skype Security Risks

Risks range from amateur hackers to sophisticated phishing operations, organized crime, and even intelligence agencies like the US National Security Agency (NSA). Key concerns center on the P2P at Skype’s core.

Microsoft resolves security issues with Teams

Microsoft, despite Skype’s popularity and ease of use, never could resolve the inherent security and privacy issues. Taking all this into account, on July 30, 2019 Microsoft announced that Teams would fully replace Skype for Business and be retired in two years – July 31,2021.

Microsoft Teams, Skype’s Replacement

Back around 2016, Microsoft reportedly considered trying to acquire the online collaboration tool Slack before deciding to compete with them. The result: in 2017 Microsoft launched Teams - a total communication and collaboration platform that unifies chat and messaging, video meetings, file storage and collaboration on files, and application integration. Skype for Business became a key component.

Teams Overtook Slack and Skype in 2019

By 2019, Teams overtook Slack in total customers, thanks in large part to its bundling as part of Office 365. You can learn more about Teams compared to Slack here. In 2020, Teams use soared as the coronavirus pandemic forced millions of people around the world to work from home.

Moving from Skype to Teams

Starting back at the end of September 2019, all new Office 365 members started getting on-boarded to Teams,but existing customers will get service until the end of July 2021.

Microsoft views this as a natural evolution and integration of all key products and services into Teams.

Here is Microsoft’s Skype to Teams upgrade process. Microsoft also has guidelines for Team-Skype “coexistence and interoperability.”


Switch4Teams is a UK-based, award-winning Unified Communications provider with over 20 years of experience.

Our voice over IP (VoIP) internet-based telephony, Microsoft Teams Direct Routing and UC cloud communication solutions are currently used by 1,000’s of SMEs and partners across the UK.

Contact us by email at info@switch4teams.com or call +44.0113.328.1330

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