Skype, the instant messaging program that allows for voice over IP, and whose name in Swedish common vernacular means "sexually transmitted disease," was created in 2003 by Niklaz Zennstrom from Sweden and Janus Friis from Denmark.
The creators of Skype first met each other at Tele2, a Swedish telecom company where they were both employed. In 1999, they put in their resignations and decided to form a development team.
Before Skype was released in 2003, both Zennstrom and Friis had already earned a name for themselves in 2001 for creating a popular file sharing software called Kazaa, which is one of the world's most downloaded programs.
While Zennstrom and Friis were employed at Tele2 they were able to establish a working relationship with programmers from Estonia who provided outsourcing services to the telecom. The fledgling entrepreneurs capitalised on this relationship by later contracting the Estonians to develop Skype.
The creators of Skype developed the program to offer a way of making local and international telephone calls in the IM environment. By utilising the publically available resources of the internet, Skype is able to successfully provide this service.
Zenntrom and Friis plan to continue developing Skype into a formidable competitor for the big telecom companies. They believe that voice over IP telephony will eventually replace the traditional telephone. In May of 2011, Microsoft announced their acquisition of Skype for a cool 8.5 Billion dollars ( £5.46 Billion).