Ex-Cisco VP sent to Skype to ready a sale

Cisco is set to make some product announcements this Thursday. It will focus on where the technology industry is going in the consumer and professional space – how brands and users can become publishers and content creators in their own right.

Crisco sorry Cisco thinks access to powerful video management tools in every space is something that’ll be increasingly important, and so will making that available to share. It has plenty of clients in video and wants to rule the roost. Thursday, sources familiar with Cisco tell TechEye, will see it continue attempting to assert itself as a market leader in pervasive video for all sectors.

But there’s a thorn in Cisco’s side called Skype. Speaking to TechEye at Mobile World Congress, Skype said that it doesn’t view Cisco as the competition because it deals heavily in enterprise whereas Skype is established in business and for the casual home user.

However, every business must take challengers seriously – so is there another reason Skype doesn’t view Cisco as a direct competitor, particularly with its efforts to edge in on consumers?
Late 2010, Skype appointed former senior VP at Cisco Tony Bates as Chief Executive Officer.

TechEye hears that one of the reasons Bates came on board at Skype was to “straighten the ship to enable Cisco to buy it”. That includes restructuring payments, the recently announced live video customer service that  comes with premium accounts and group video calls. Importantly it also underlines Skype’s excellent position within emerging markets, where it has nested itself comfortably as both a charitable organisation and for-profit. 

Most strikingly, Skype has a firm foothold in mobile. Wireless giant Cisco – always a company to keep an eye on – really wants to cement itself in the mobile space. Buying Skype would, our source said, “give it a play in the mobile space, which is an architecture of interest to Cisco.”

Last year, TechEye reported on Cisco eyeing up Skype by way of a Michael Arrington source. Cisco had just announced plans to buy ExtendMedia while Skype had, at a similar time, filed an initial public offering. At the time Skype was valued at an estimated $5 billion. 

With the obvious benefits and interest a buy-out of Skype would deliver, coupled with a former top dog at Cisco leading the charge, it makes perfect sense for a hard sell to happen in the near future. But would eBay, part-owner of Skype, give the nod to saying bye to its tidy earner?

Skype’s spokespeople at Barcelona last week said it wasn’t something they could discuss.