Why is Microsoft closing its Skype office in London?


After the Brexit vote, and at a time when the UK is trying to position itself as an attractive option, the reports that one of the most valuable tech firms valued at more than $1bn in Europe is to scale down its presence in London, will come as a low blow to the brisitsh economy.

According to the ”Financial Times”, Microsoft confirmed that some “globally focused Skype” roles were at risk along with those at another of its businesses, Yammer, as part of a plan to move all London-based employees to its base in Paddington. The company also added that, it will “unify some engineering positions,” but that it “will be entering into a consultation process to help those affected by the redundancies.”

The London office is a key part of Skype’s history, since it was the primary engineering site and headquarters of the company before Microsoft acquired it, and it also survived Skype’s strange interlude under the ownership of eBay before it was acquired by Microsoft.

While the move is no doubt a blow to London’s tech scene, some former insiders told the FT that it’s also not a surprise to see it go, largely because a steady stream of executive departures over the last few years have foretold a shift in the locus of power at the company. Post-acquisition, Microsoft has also done a lot of product work on Skype, with plenty of integration with Office 365 and a number of feature introductions that bring it closer in line with Slack.

Microsoft likely now intends to build Skype from Redmond, which should help further align its strategic vision across its software products.

Russ Shaw, who served as a vice president at Skype until it was bought by the US-based technology giant for $8.5bn in 2011, said the move from its current base in Holborn was disappointing.

Skype is one of Europe’s iconic technology businesses and a genuine ‘unicorn’ with an amazing pedigree of innovation and talent. While London is working hard to build a strong base of world-class technology businesses, this decision is a step in the wrong direction.” He told the FT.



Categories: Tech

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