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Ballmer to Skype Fans: You Can Trust Us

SAN FRANCISCO — Trust us. We’re not going to screw up Skype.

That was the message Microsoft delivered Tuesday, hours after formally announcing that it was buying the internet telephony pioneer for a staggering $8.5 billion — staggering because it’s more than the Redmond giant has ever paid for anything, and because Skype doesn’t exactly print money.

But in an early morning press conference, as Google strutted for its Android developers in another part of town, an increasingly mobile-minded Microsoft made the Skype acquisition seem like the most logical thing ever. And, it said, it has no intention of messing with the brand which has become a consumer favorite and synonymous with the disruption of the telephone business.

We know what we’re doing, Microsoft CEO Steve Ballmer said on a noticeably small stage he shared with Skype CEO Tony Bates to explain why the merger of their two companies makes sense.

“We’re irrepressible,” said Ballmer. “This Skype acquisition is completely consistent with our ambitious, forward-looking, irrepressible nature. Microsoft and Skype will bring together hundreds of millions — or as Tony said, billions! — of consumers and empower them to connect in new and interesting ways. It’s core to our mission, and it’s core to our technology direction.”

Microsoft’s acquisition of the Luxembourg-based Skype will close this year, assuming it passes regulatory muster, the executives said.

Skype is the poster child for voice-over-internet-protocol — or VOIP — services, which allow customers to place telephone calls using the internet’s infrastructure instead of the phone company’s. Most people use Skype to place free calls to other Skype users. After its founding in 2003, eBay paid $3.1 billion for Skype in 2005, then sold the majority of it to an investment group in 2009 for $1.9 billion.

Skype is popular, especially among people who use its services to place international calls cheaply or for free. But it hasn’t exactly captialized on the social networking revolution and has faced carrier resistance in its efforts to create fully featured mobile clients. Meanwhile, Google acquired a competing service, Grand Central, for a reported $50 million in 2007, eventually launching it as Google Voice in 2009. Google recently struck a deal with Sprint, enabling Sprint customers to integrate their phone numbers with Google Voice.

Microsoft’s purchase of Skype is arguably as much about defense as offense. It denies Skype to, say, Facebook and Google, both of which were reported just days ago to be interested in in partnering with, and possibly buying it. As carriers de-emphasize what are becoming commoditized calling minutes in favor of pricier data bytes, Microsoft’s strategic alliance with Nokia also gives it huge reach in the distribution of Skype-integrated handsets.

However, that seems like a rich price tag for a company that only generated $860 million in revenue in the most recent year and $264 million in operating profit — yet no net profit at all. Microsoft is paying about $50 for each of Skype’s 170 million users, or about $1,000 for each of its 8 million paying customers.

Ballmer seemed optimistic about Skype’s ability to integrate into Microsoft’s current businesses, such as Windows Live Messenger and the corporate-oriented Lync. He said he expected to apply “classic” business metrics to evaluate the success or failure of the new Skype division.

Charles Golvin, an analyst with Forrester Research, said that while Skype probably wouldn’t generate much revenue for Microsoft directly, it could be a valuable addition to other internet-based services, in which e-mail, voice and video are all becoming part of the same stream of data.

“Part of the bet that Microsoft is placing is that this technology helps them do a better job of delivering to that river of communications,” Golvin said.

For instance, Golvin suggested, the company could integrate Skype into Xbox and Xbox Live, which — with the addition of Kinect — have become more voice-centric products in the last year.

Both executives sought to reassure Skype customers who might be worried about Microsoft’s ability and willingness to support the multiplatform software, which is available for Windows, OS X and Linux PCs; Android, BlackBerry and iOS smartphones; and even televisions.

“We’re one of the few companies that has actually has a track record of doing this,” said Ballmer, pointing to the company’s Mac support over the years. “Fundamental to the value proposition of communications is being able to reach everybody, whether they happen to be on your devices or not.”

“The commitment from Microsoft to support multiplatform clients is absolutely critical,” Bates said, indicating that Skype got assurances from Microsoft that it would continue to support all of Skype’s platforms.

Finally, Ballmer indicated no intention to take on the carriers in an aggressive attempt to bring VOIP services into Windows Phone 7. Indeed, Ballmer said, “the partnership and collaboration that we have today [with carriers] is fundamental.”

Bates pointed to Skype’s track record of striking deals with carriers to offer Skype services as a differentiating feature.

In other words, expect Microsoft to try to sell Skype to carriers, not use it to bash them about the head with VOIP services that reduce their billable minutes.

 

Story originally published on Wired.com: Ballmer to Skype Fans: You Can Trust Us | Epicenter | Wired.com.

Sony Touts Console-Like Power of Upcoming NGP

SAN FRANCISCO — Sony is blurring the line between portable game consoles and larger consoles currently trapped inside TV cabinets.

With a high-resolution screen, a powerful processor and graphics card, and massive amounts of memory, the upcoming Sony NGP will be closer to the capabilities of a PC or PS3 than it is to Sony’s current portable, the PSP, according to a Sony executive speaking at the Game Developers Conference Wednesday.

The NGP’s 5-inch screen is substantially bigger than the PSP’s 4.3-inch screen, and has 4 times the resolution, or 960×544 pixels. That’s about midway between the PSP and the PS3, according to David Coombes, a platform designer for Sony Computer Entertainment America.

“People get choked up, they get tears in their eyes when they see that screen,” said Coombes.

Inside, there’s a 4-core, 32-bit ARM9 processor.

There’s also a PowerVR SGX543MP4+ GPU inside, which should deliver impressive video rendering. This is also a multi-core chip with the ability to dynamically load balance between its cores.

The NGP also includes some dedicated chips for media playback.

“It’s very similar to a modern PC” in terms of its processing power, said Coombes. And while Coombes wouldn’t state specifics about memory, he said it’s closer to the PS3 than to the PSP in terms of available RAM.

Games can be loaded via game cards with a capacity of either 2GB or 4GB, giving developers lots of room to create huge, complicated software and datasets.

A big NGP game will take about 4GB, compared to around 9GB for a PS3 game. By contrast, Coombes said, a typical iPhone game occupies only 10MB. The point is that an NGP game can include a lot more data, making it potentially far more complicated, with richer graphics, more detailed and larger worlds, and so forth.

For big games, developers will be able to reuse a lot of assets from existing Xbox or PS3 games, Coombes said, although naturally models, shaders and textures will have to be simplified for the NGP.

A demo of Uncharted for the NGP showed a rich, complicated environment and a variety of ways to control the little man on the screen, from using the analog controls and buttons to swiping on-screen to make him climb from handhold to handhold or to throw enemies into the abysses below. (See below for video.)

Other features included in the NGP include a second analog stick, plus a 3-axis accelerometer and a 3-axis gyroscope, for 6 axes of motion sensitivity.

There’s a touchscreen on the front and also on the back, which you can manipulate with the fingers you’re using to hold the NGP. Both touchscreens support multitouch, and can register how hard you are pressing them as well. A quick demo with a developer from BigBig studios showed the rear touchscreen being used to deform a cartoon landscape to roll a ball around, while touching the front touchscreen changed the camera angle and position.

Like nearly every other portable device hitting the market this year, the NGP has a camera on the front and one on the back. The cameras are meant for game play, said Coombes.

“We need high frame rate, so we can get sharper images” for fast-moving game play. So the cameras are optimized for high-speed, low-light video, not for taking pictures.

Wi-Fi-only and 3G/Wi-Fi models will be available, although the final configurations are not yet settled. The 3G models will also include GPS support, although the Wi-Fi models can also do positioning via Skyhook Wireless, which uses data about Wi-Fi hotspot locations to get relatively accurate location information.

Originally published on Wired: Sony Touts Console-Like Power of Upcoming NGP | GameLife | Wired.com.

Reports: Verizon iPhone Likely Coming Jan. 11

U.S. iPhone users frustrated with AT&T’s frequently dropped callslimited geographic coveragedelayed delivery of iPhone tetheringelimination of unlimited data planspoor customer service, and alleged cooperation with warrantless wiretapping by the NSA may soon have an alternative.*

Verizon yesterday sent out invitations to a Tuesday, Jan. 11 press event in New York.

Many believe that this event will be the debut of the iPhone on Verizon.

Full story:

Reports: Verizon iPhone Likely Coming Jan. 11 | Gadget Lab | Wired.com.

Steve Ballmer. photo by Jon Snyder/Wired.com

‘Windows Will Be Everywhere,’ Ballmer Promises

Steve Ballmer. photo by Jon Snyder/Wired.com

LAS VEGAS — Microsoft unveiled its vision of the future, where everything from phones and tablets to big-ass tables runs Windows.

Microsoft CEO Steve Ballmer delivered a somnolescent and nearly news-free keynote presentation on the eve of the Consumer Electronics Show here, laying out his company’s strategy for home entertainment, mobile content, PCs and tablets.

“Whatever device you use, now or in the future, Windows will be there,” Ballmer said.

Full story: ‘Windows Will Be Everywhere,’ Ballmer Promises | Gadget Lab | Wired.com.