Twenty-three years after pioneering internet-based calls, Skype is shutting down. Microsoft, the company that acquired Skype 14 years ago, has announced that it will retire the messaging and calling app on May 5 to focus on its Teams platform. Skype users have 10 weeks to decide what to do with their accounts.

The exact number of users impacted is unclear, as the most recent statistics available are from 2023, when Microsoft reported that Skype had more than 36 million users, a significant decline from its peak of 300 million users.

Jeff Teper, President of Microsoft 365 Collaborative Apps and Platforms, expressed gratitude for Skype users’ support and acknowledged that the decision to retire Skype is significant. “We know this is a big deal for our Skype users, and we’re very grateful for their support of Skype and all the learnings that have factored into Teams over the last seven years,” Teper said in an interview. “At this point, putting all our focus behind Teams will let us give a simpler message and drive faster innovation.”

Between now and May 5, users can choose to migrate their contacts and chat data to Microsoft’s Teams platform or download their Skype data using the app’s built-in export tool.

The Business Case

The news may not come as a surprise to those who have followed Skype’s journey in recent years. The writing has been on the wall since 2016, when Microsoft launched Teams, a platform that signaled a new direction for the company in the cloud communications space.

Microsoft had previously launched Skype for Business in 2015, but Teams’ arrival marked a shift towards a more comprehensive platform for collaboration and communication. Many saw Teams as a Slack clone, but its ambition was broader, aiming to provide a space for collaboration and communication across various Microsoft and other apps, including video and text chatting, which overlapped with Skype’s functionality.

In 2017, Microsoft revealed plans to phase out Skype for Business, concluding those efforts four years later, in 2021. That same year, Microsoft integrated Teams into Windows 11, effectively relegating Skype to the sidelines.

In December 2024, Microsoft stopped allowing Skype users to add credit to their accounts or buy Skype phone numbers, pushing users towards monthly subscriptions and Skype-to-phone plans instead.

This development marks the end of a brand and company that was one of the first significant tech startups to emerge from Europe in the early days of dial-up internet.

Skype’s demise comes two years after Microsoft began rolling out a rebuilt, rearchitected Teams desktop and web app. During this period, Teper reports that consumer calling minutes in Teams have grown four-fold, although he declined to disclose the exact number of consumers using the platform.

“It’s at a high-enough scale that we feel great about the app [Teams] for personal use,” Teper said. “We feel we have the mileage under our belt on the adoption by consumers, [who are] using Teams in their personal lives. We’ve thought about [shutting down Skype] for a while, but we really felt like the product had to show the end-user adoption with consumers telling us it was ready.”

Microsoft believes that consumers are now ready to transition to Teams.

User Numbers

Skype revolutionized internet-based communication, starting with voice calls and later expanding to video and file-sharing. However, the rise of smartphones and new messaging apps has taken a toll on Skype’s user count over the years. For context, WhatsApp surpassed 2 billion users in 2020.

When Skype filed for an IPO in 2010, it reported 560 million registered users and 124 million monthly active users. However, instead of going public, Microsoft acquired Skype in 2011 for $8.5 billion and grew the platform to a peak of 300 million users in 2013.

Microsoft hasn’t regularly released Skype user numbers in recent years, but it did reveal that Skype had grown 70% month-on-month to 40 million daily users at the start of the pandemic in March 2020. The most recent update, published in a blog post in early 2023, stated that “more than 36 million people use Skype daily to connect through phone calls and chats” globally.

The long and short of it is that Teams’ growth and Skype’s stagnant user base have led Microsoft to decide that now is a good time to focus on Teams.

Phone Home

Microsoft is encouraging users to migrate to Teams Free, which offers additional features like calendar integrations but lacks phone-calling functionality. In December 2024, Microsoft began depreciating Skype’s phone-calling services, preventing users from adding credit to their accounts or buying Skype numbers.

For legacy users with remaining credit, Microsoft will provide a Skype Dial Pad in the Skype web portal and in Teams for an indefinite period. “We’ll support [this] as long as users have credit and they’re using this functionality,” said Amit Fulay, Microsoft VP of Product.

Despite Teams’ enterprise version offering phone-calling functionality, Fulay confirmed that Teams Free won’t support PSTN services, citing shifting consumer trends and the widespread adoption of mobile data plans.

System Migration

During the transition period, Skype users can download the Teams app and log in with their Skype credentials, with all their chats and contacts migrating over automatically. The Skype app will continue to work in tandem until May 5, 2025.

Alternatively, users can export their data, although it’s unlikely they’ll be able to import it into another platform.

“We wanted to make sure that during this transition, people aren’t losing their contacts, their memories,” Fulay said. “We want to make sure we preserve all the things people have shared. And if they choose to come to Teams, we’ll restore all of their contacts and data.”

If users take no action by May 5, Skype will retain their data until the end of the year, after which it will be deleted.

Blurred Lines

The boundaries between business and consumer realms have become increasingly blurred, driven by societal norms around technology and trends like remote work. Skype began as a consumer product that expanded into the business sphere, while Teams started as a business product that later entered the consumer market.

Today, Teams still feels like a business product, particularly due to its name. However, Teper doesn’t see this as a problem, given that many Microsoft products already transcend use-case boundaries.

“I think a lot of people will make the transition [from Skype to Teams],” Teper said. “If you think about Word, Excel, PowerPoint, those are brands that work for business and personal use for people. We have kids and parents doing their homework in Word, and budgets and Excel, so we have good precedent about our tools being used in personal and work life.”