newsAs ubiquitous as Microsoft is, in recent years it was starting to feel like it was losing it’s edge to a resurgent Apple and such newer, younger corporate upstarts like Google and Facebook.  And, of course, Skype, the leader in internet communications.  But Microsoft announced today that it will acquire Skype, a move that should position the company to be better able to compete in this constantly changing and ever more competitive corporate landscape.

According to press releases from both Microsoft and Skype, the two companies have entered into a definitive agreement under which Microsoft will acquire Skype, the leading Internet communications company, for $8.5 billion in cash from the investor group led by Silver Lake. The agreement has been approved by the boards of directors of both Microsoft and Skype.

Skype will support Microsoft devices like Xbox and Kinect, Windows Phone and a wide array of Windows devices, and Microsoft will connect Skype users with Lync, Outlook, Xbox Live and other communities. Microsoft will continue to invest in and support Skype clients on non-Microsoft platforms.

“Skype is a phenomenal service that is loved by millions of people around the world,” said Microsoft CEO Steve Ballmer. “Together we will create the future of real-time communications so people can easily stay connected to family, friends, clients and colleagues anywhere in the world.”

in Mergers and Acquisitions]