Microsoft on verge of $7-bn deal to buy Skype

Media buzz has it that Microsoft is on the verge of snapping up internet phone company Skype in a $7 billion deal.Although the deal hasn't yet been formally sealed - and could still come apart - it could be announced as early as Tuesday, Wall Street Journal reports, citing people familiar with the deal.

[caption id="attachment_7096" align="alignright" width="380" caption="Deal is likely to be announced today. Reuters"][/caption]

Skype, which has shrunk the world by allowing users to make voice calls and chats over the Internet, has 663 million registered users. An industry research report claimed last year that Skype-to-Skype calls accounted for 13% of all international call minutes in 2009; of the 406 billion international call minutes, a total of 54 billion were used by Skype calls.

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Skype, which is minority-owned by online auction giant eBay, is headquartered in Luxembourg; but much of the development work goes on in Tallinn, in the Baltic state of Estonia, from where the developers of the Skype software hail.

The Journal adds the deal "represents Microsoft's most aggressive move yet" in the converging worlds of communication, information and entertainment, and that it would give Microsoft, which is "struggling to get more traction" in the consumer market, an established brand name.