Microsoft in Talks with UAE on Lifting Ban on Skype



UAE laws restrict use of Internet calling services

Microsoft (MSFT) is in talks with UAE (United Arab Emirates) authorities about lifting the country’s ban on Skype. Skype, Microsoft’s video and audio calling app, has been restricted in the UAE for years, and earlier this year, the government moved to block it.

The ban on Skype is because UAE’s telecom laws restrict the use of voice-over for Internet protocol services. Apple’s FaceTime and Facebook’s (FB) WhatsApp are other apps that allow people to make free audio and video calls as long as they are connected to the Internet. Restrictions on Internet calling services in the UAE are seen as aimed at protecting the telecommunications sector.

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Microsoft charges for business version of Skype

Microsoft’s Skype is available in two versions—one for consumers and one for businesses. Skype for consumers is free, while Skype for businesses starts at $2 per user per month. Skype for business is one of Microsoft’s products in the enterprise collaboration market that is forecast to grow at an annual rate of 13.2% to $49.5 billion in revenues by 2021, according to MarketsandMarkets. Lifting the ban on Skype in the UAE could contribute to a faster expansion of the market for enterprise collaboration solutions, potentially yielding more revenues for Microsoft.

Microsoft’s revenue increased 16%

Microsoft generated $26.8 billion in revenue in fiscal 3Q18 (March quarter), representing an increase of 16% YoY (year-over-year). Revenue growth was supported by a strong demand for Microsoft’s cloud computing services. Azure, Microsoft’s core cloud product, recorded a 93% YoY increase in revenue in the latest quarter. Amazon’s (AMZN) cloud revenue increased 49% YoY, while IBM’s (IBM) cloud revenue grew 20% YoY in a similar period. Cloud revenue rose 32% YoY for Oracle (ORCL) in the latest quarter.


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