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Skype is a proprietary voice-over-Internet Protocol service and software application originally created in 2003 by Swedish entrepreneur Niklas Zennström and his Danish partner Janus Friis. It has been owned by Microsoft since 2011.

The service allows users to communicate with peers by voice, video, and instant messaging over the Internet. Phone calls may be placed to recipients on the traditional telephone networks. Calls to other users within the Skype service are free of charge, while calls to landline telephones and mobile phones are charged via a debit-based user account system. Skype has also become popular for its additional features, including file transfer, and videoconferencing. Competitors include SIP and H.323-based services, such as Lin phone, as well as the Google Talk service, Mumble and Hall.com.

Skype has 663 million registered users as of September 2011. The network is operated by Microsoft, which has its Skype division headquarters in Luxembourg. Most of the development team and 44% of the overall employees of the division are situated in Tallinn and Tartu, Estonia.
Unlike most other VoIP services, Skype is a hybrid peer-to-peer and client–server system. It makes use of background processing on computers running Skype software. Skype's original proposed name (Sky Peer-to-Peer) reflects this fact.

Some network administrators have banned Skype on corporate, government, home, and education networks, citing reasons such as inappropriate usage of resources, excessive bandwidth usage, and security concerns.

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History

Skype was founded in 2003 by Janus Friis from Denmark and Niklas Zennström from Sweden. The Skype software was developed by Estonians Ahti Heinla, Priit Kasesalu, and Jaan Tallinn, who together with Friis and Zennström were also behind the peer-to-peer file sharing software Kazaa. In August 2003, the first public beta version was released.

eBay acquisition
On 12 September 2005 eBay Inc. agreed to acquire Luxembourg-based Skype Technologies SA for approximately US$2.6 billion in up-front cash and eBay stock, plus potential performance-based consideration.
Microsoft acquisition

On 10 May 2011, Microsoft Corporation acquired Skype Communications, S.à r.l for US$8.5 billion. The company was incorporated as a division of Microsoft, and Microsoft acquired all of the company's technologies with the purchase. This was completed on 13 October 2011.

Features

Registered users of Skype are identified by a unique Skype Name, and may be listed in the Skype directory. Skype allows these registered users to communicate through both instant messaging and voice chat. Voice chat allows telephone calls between pairs of users and conference calling, and uses a proprietary audio codec. Skype's text chat client allows group chats, emoticons, storing chat history and editing of previous messages. Offline messages were implemented in a beta of version 5, but removed after a few weeks without notification. The usual features familiar to instant messaging users — user profiles, online status indicators, and so on — are also included.

The Online Number, a.k.a. SkypeIn, service allows Skype users to receive calls on their computers dialed by conventional phone subscribers to a local Skype phone number; local numbers are available for Australia, Belgium, Brazil, Chile, Colombia, Denmark, the Dominican Republic, Estonia, Finland, France, Germany, Hong Kong, Hungary, Ireland, Italy, Japan, Mexico, New Zealand, Poland, Romania, South Africa, South Korea, Sweden, Switzerland, Turkey, the Netherlands, the United Kingdom, and the United States. A Skype user can have local numbers in any of these countries, with calls to the number charged at the same rate as calls to fixed lines in the country.

Video conferencing between two users was introduced in January 2006 for the Windows and Mac OS X platform clients. Skype 2.0 for Linux, released on 13 March 2008, also features support for video conferencing. Version 5 beta 1 for Windows, released 13 May 2010, offers free video conferencing with up to five people.

Skype for Windows, starting with version 3.6.0.216, supports "High Quality Video" with quality and features, e.g. full-screen and screen-in-screen modes, similar to those of mid-range videoconferencing systems. Skype audio conferences currently support up to 25 people at a time, including the host.

Skype does not provide the ability to call emergency numbers such as 911 in the United States and Canada, 999 in the United Kingdom and many other countries, 111 in New Zealand, 000 in Australia, or 112 in Europe. The U.S. Federal Communications Commission (FCC) has ruled that, for the purposes of section 255 of the Telecommunications Act, Skype is not an "interconnected VoIP provider". As a result, the U.S. National Emergency Number Association recommends that all VoIP users have an analog line available as a backup.

In 2011 Skype partnered with Comcast to bring its video chat service to Comcast subscribers via their HDTV sets.

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