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Facebook introduces free Skype video calls

By Bloomberg News

POSTED:
LAST UPDATED: 10:20 a.m. HST, Jul 06, 2011


Facebook Inc., the world’s largest social-networking service, is offering free video calls over its site through a partnership with Skype Technologies SA.

Facebook also said it has more than 750 million users, up from 500 million, in an announcement today at an event in Palo Alto, California, where it is based. Microsoft Corp., a long- time Facebook partner, is acquiring Skype in an $8.5 billion deal expected to close later this year.

Adding video calls puts Facebook in competition with Apple Inc., which introduced the feature on its iPhone in June 2010, and with Google Inc., which offered Web calls through Gmail in August. Partnerships with Skype and other multimedia services are aimed at growing Facebook’s audience and getting users to rely more on their social connections.

“We’re using the best technology that’s out there for doing video chat with the best social infrastructure that’s out there in order to create some really cool new scenarios,” said Mark Zuckerberg, Facebook’s chief executive officer, during a presentation at the event.

Social networking rivalry intensified last week when Google unveiled a new service to compete with Facebook. The site, called Google+, includes Google’s maps and images, messages, comments and other content from selected groups of friends.

Facebook began holding talks with Skype about offering Web video calls on its social network in 2010, a person familiar with the discussions said earlier this year. An October update to Skype included voice calling between Facebook friends. Microsoft agreed to buy Skype in May.

Microsoft, based in Redmond, Washington, invested $240 million in Facebook in 2007 and entered an agreement to sell ads on the social network.

Facebook is forging ties with other media and technology companies. It added Netflix Inc. CEO Reed Hastings to its board of directors in June and discussed incorporating more social features into the online video-streaming service. In March, Time Warner Inc.’s Warner Bros. studio announced plans to offer movie rentals on Facebook for $3.

Facebook is valued at $71 billion on SharesPost Inc, an exchange for shares of private companies.






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