Microsoft to buy out Skype for $8.5 bln

Software giant Microsoft is set to take in Internet telephony service Skype in a move to keep up with rivals such as Google for $8.5 billion in cash, a price that is being seen as too high.

Despite discouraging track record for months, Skype, with a 600 million customer base and a significant corporate following, could bring in opportunities for Microsoft that is increasingly turning towards enterprise software.

Experts say, Skype?s technology could help Microsoft further boost the values of its already-successful products like Office, XBox Live and Windows Live Messenger, among other products.

Investors however, seemed to react skeptically with a slight tumble in Microsoft?s shares. However, the deal is expected to rake in profits for Skype’s owners online auction site eBay Inc and a group of investors.