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June 13, 2011

Microsoft News - Logitech Suggests It May Get More Business with Microsoft Acquiring Skype

By Ed Silverstein, TMCnet Contributor

Logitech may get more business with Microsoft's purchase of Skype (News - Alert) because of it leading to increased user awareness of video communications, according to media reports.

Craig Malloy, CEO of Logitech's LifeSize division, told Reuters that Microsoft's (News - Alert) acquisition of Skype for $8.5 billion will not threaten providers of video technology. In fact, increased interest in videoconferencing could increase its sales of its webcams, Reuters said.

"It is a good thing. I do not see it negatively impacting our business at all. It has increased awareness and demand for videoconferencing," Malloy said in a Reuters interview. "Microsoft would have not paid $8.5 billion if they did not see a massive new market here. There is an enormous amount of growth left in this industry. There are many, many years of high growth left.”

Logitech – which manufactures mice, speakers, webcams and keyboards – purchased LifeSize (News - Alert) for $405 million in 2009, Reuters said.

In addition, Ovum in May predicted the market for videoconferencing equipment to increase about 6 percent a year through 2016, Reuters reports.

The lower-portion of the $3 billion videoconferencing equipment market is impacted by Skype and other video apps, Reuters adds.

There are other recent acquisitions in the sector. For example, Cisco (News - Alert) spent over $3 billion for Tandberg and Polycom has purchased HP's videoconferencing unit, Reuters said.

In another story related to Skype, The Inquirer reports that there was a “fallout” from Skype's “second major outage last week.” The Inquirer says some businesses are thinking about “alternative means of internet messaging, with one rival outfit claiming Skype is not 'professional' enough for business use.” The statement was made by Ashish Gupta, a senior vice president of corporate development at Vidyo, who told The Inquirer that, “Companies need to ensure they have a future proof HD platform that is, most importantly, reliable." He called the crashes a “wake-up call” for businesses.

In other recent news about Logitech (News - Alert), the company has introduced the Logitech Touch Lapdesk N600, which has a large touchpad that simplifies pointing, scrolling and swiping via the Web, according to a report carried by TMCnet. The N600 has a 5-inch, retractable touchpad with multi-touch navigation, TMCnet adds.

Ed Silverstein is a TMCnet contributor. To read more of his articles, please visit his columnist page.

Edited by Stefanie Mosca

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