As expected, Microsoft today released Skype for Windows version 5,8, which among other new features allows you to conduct a Facebook-to-Facebook call from within the Skype client. You can download the new version from skype.com/go/download.

Here’s the changelog for version 5.8.0.154:

Full HD video-calling
Support for Facebook audio and video-calling (beta)
Group screen sharing
Hide offline Facebook contacts
Push to Talk
Skype updater service
Bing Bar integration

The new version means Skype users can check their Facebook News Feeds, instant messages, and video call their Facebook friends all from within Skype. Even if your Facebook friends are not on Skype, they can still pick up a Skype instant message or video call from within Facebook.

To start a Facebook-to-Facebook call from within Skype, you must first connect your Skype and Facebook accounts (sign in to the Skype client, click on the Connect to Facebook tab, and log in to Facebook). Once that’s done, you can select a Facebook friend and hit the video call button in Skype — your friend can then pick up the call from Facebook.

Even before this update, Skype already let you see when your Facebook friends are online, read their status updates, instant message them using Facebook Chat, comment and Like their posts, check and update your News Feed, all within the client. After helping Facebook launch video calling for its 845 million active users, the company has now ported the feature over to its desktop application as well.

While this new version is only for Windows, the Mac-equivalent of this update is still in the works. The latest version is Skype 5,4 Beta for Mac.

The company’s «Make the Web Faster» team is making several recommendations to improve TCP speed, including increasing the TCP initial congestion window. In a blog post on Monday, team member Yuchung Cheng called TCP «the workhorse of the Internet,” designed to deliver Web content and operate over a range of network types. Web browsers, he said, typically open up parallel TCP connections ahead of making actual requests.» This strategy overcomes inherent TCP limitations but results in high latency in many situations and is not scalable,” he said. «Our research shows that the key to reducing latency is saving round trips. We’re experimenting with several improvements to TCP.”

[ Previously, Google has advocated a cooperative effort to make the Web faster. | Subscribe to InfoWorld’s Technology: Networking newsletter for more insights and news on networking. ]

Recommendations include increasing the TCP initial congestion window. «The amount of data sent at the beginning of a TCP connection is currently three packets, implying three round trips to deliver a tiny, 15K-sized content. Our experiments indicate that IW10 [initial congestion window of 10 packets] reduces the network latency of Web transfers by over 10 percent,” Cheng said. Google also wants the initial timeout reduced from three seconds to one second. «An RTT [round-trip time] of three seconds was appropriate a couple of decades ago, but today’s Internet requires a much smaller timeout.”

Google Looks to Speed Up the InternetGoogle’s suggestions, said IDC analyst Al Hilwa, «appear to be well-researched recommendations and if implemented broadly will yield significant improvements in practically everyone’s network performance and latency. The issue is that the capability has to be broadly implemented to achieve the desired performance gains. Of course new TCP/IP stacks would work with the old ones as they would now, but when two sides of a connection have the improvements, the benefits should surface.”

Google also is encouraging use of the Google-developed TCP Fast Open protocol, which reduces application network latency, and proportional rate reduction (PRR) for TCP. «Packet losses indicate the network is in disorder or is congested. PRR, a new loss recovery algorithm, retransmits smoothly to recover losses during network congestion. The algorithm is faster than the current mechanism by adjusting the transmission rate according to the degree of losses. PRR is now part of the Linux kernel and is in the process of becoming part of the TCP standard,” Cheng said.

Also, Google is developing algorithms to recover faster on «noisy» mobile networks, said Cheng.

Google’s TCP work is open source and disseminated through the Linux kernel, IETF standards proposals, and research publications to encourage industry involvement, Cheng noted.

This article, «Google looks to speed up the Internet,” was originally published at InfoWorld.com. Follow the latest developments in business technology news and get a digest of the key stories each day in the InfoWorld Daily newsletter. For the latest developments in business technology news, follow InfoWorld.com on Twitter.

Microsoft’s Office software and other business programs helped profit exceed projections last quarter, even as sales of Windows suffered from sluggish personal-computer orders. Intel and IBM, meanwhile, both delivered rosier sales forecasts than some analysts had predicted.

Reports from the trio of companies, with a combined market value of almost $600 billion and an average lifespan of six decades, allayed investors’ concerns that a slowdown in Europe, anemic consumer demand and last year’s floods in Thailand would hobble the information-technology industry. Corporate customers haven’t let up on orders, lifting sales at all three companies, while Intel is getting an extra boost from emerging markets.

«Old dogs can still hunt,” said Pat Becker Jr., a fund manager at Becker Capital Management in Portland, Oregon. His firm has invested in all three companies.

Microsoft, the world’s largest software maker, climbed 5,7 percent to $29,71 today in U.S. trading. Intel rose 2,9 percent to $26,38, while IBM advanced 4,4 percent to $188.52.

‘Oracle-Specific Event’

The results were a relief for many investors after Oracle Corp. reported weaker-than-anticipated earnings last month, fueling speculation that businesses were holding off on technology spending, said Brendan Barnicle, an analyst at Pacific Crest Securities in Portland.

«The results of these three companies suggest that was an Oracle-specific event,” Barnicle said.

The positive outlook also contrasted with the earnings of Google Inc., which also delivered its report yesterday. The Mountain View, California-based company missed analysts’ sales and profit estimates, dragged down by the European crisis and a push into mobile technology, which yields lower ad revenue. Google shares fell 8,4 percent to $585,99 today.

Sales at Microsoft’s business division, largely made up of Office products such as Word and Excel, rose 2,8 percent to $6,28 billion. Analysts had estimated $6,1 billion on average, according to data compiled by Bloomberg. The company’s Xbox video-game business also topped projections, generating $4,24 billion in revenue.

Microsoft Profit

Microsoft, based in Redmond, Washington, posted net income of $6,62 billion, or 78 cents a share. That beat the 76-cent average estimate.

IBM, the biggest provider of computer services, reported fourth-quarter earnings of $4,71 a share, excluding some items. Analysts had predicted $4.62. The Armonk, New York-based company’s forecast for 2012 earnings also exceeded predictions.

Intel, which dominates the market for computer chips, expects sales of $12,8 billion, indicating that production is bouncing back after the Thai flooding. The disaster wiped out a quarter of the computer industry’s disk-drive production, delaying shipments of PCs. Research firms Gartner Inc. and IDC had lowered their PC sales forecasts as a result of the floods.

The supply disruptions hurt revenue at Santa Clara, California-based Intel last quarter. IBM’s sales also were lower than expected in the period.

Trip Chowdhry, an analyst with Redwood City, California- based Global Equities Research LLC, says technology companies still face long-term challenges. Higher gasoline costs, for one, will both hurt consumer spending and increase the price of raw materials, he said.

Corporate buyers are showing more resiliency than consumers, who are reeling from a still-shaky job market. Businesses are the driving force behind Microsoft, IBM and Intel’s results, said Michael Holland, chairman of New York- based Holland & Co., which oversees $4 billion in assets.

«The consumer continues to have unemployment problems and confidence problems, but businesses are doing everything they can to grind out profits,” Holland said.

-With assistance from Peter Burrows in San Francisco and Beth Jinks in New York. Editors: Nick Turner, Stephen West

Microsoft had precious little choice when it came to importing Windows onto tablets, according to a new analyst report. Softening PC sales-which translated into declining Windows revenue-meant the company needed to look at ways to extend its business model onto new, more mobile devices.

For its second quarter fiscal 2012, Microsoft saw its Windows and Windows Live division revenue dip some 6 percent from the prior period, to $4,74 billion. Company executives on a Jan. 19 earnings call highlighted recent flooding in Thailand, which curbed the global supply of hard drives, as a reason behind the recent decline in PC sales and attendant drop in Windows revenue.

According to at least one analyst, however, the dip in PC sales is a much longer-term proposition. «Flooding in Thailand only has short-term implications on the overall condition of Microsoft’s Windows division,” Matthew Casey, an analyst with Technology Business Research, wrote in a Jan. 19 note. «The long-term concern for Microsoft through 2012 will be how to transition its PC-dependent Windows business to a sustainable business model beyond the single device.» In other words, smartphones and tablets (along with super-portable laptops like ultrabooks) are increasingly important to Microsoft’s long-term growth.

The Windows 8 beta will arrive in February, with a final release reportedly scheduled for the second half of 2012. It remains to be seen when the first Windows 8 tablets will hit store shelves.

While the Windows franchise reorients itself, he sees another Microsoft vertical taking more of a role in driving the company’s revenue. «At the same time Microsoft’s Windows and Office divisions face the challenges of continuing to grow as mature franchises, the Server & Tools division is solidifying its position as the next foundational franchise,” Casey wrote. «The company is taking advantage of growing cloud and virtualization adoption.”

But that doesn’t lessen Microsoft’s need for Windows 8 to prove a sizable hit, even as the operating system arrives at a time when Windows 7, released three years ago, is still enjoying robust sales. Windows 8 on tablets will also find itself in a Sergio Leone-style stare-down with Apple’s iPad, which currently dominates that vertical.

According to a rather voluminous document («Windows Hardware Certification Requirements») posted on a Microsoft Website, Windows 8 tablets will require at least 10GB of free space, WLAN and Bluetooth 4,0 + LTE for networking, minimum 1366-by-768 screen resolution, at least one USB 2,0 controller and exposed port, a 720p camera, and a combination of gyroscope, three-axis accelerometer, and magnetometer.

Whereas previous versions of Windows offered a traditional «desktop» interface, complete with folders and start button, Windows 8 is further optimized for tablets with a start screen composed of big, colorful, touchable tiles linked to applications. A big part of Microsoft’s future depends on whether that interface, paired with that hardware, plays to consumers’ and businesses’ wants and needs.

Industry leaders at the Consumer Electronics Show this week debated the role Microsoft could play in tablets. Some said Microsoft could carve out a niche selling tablets to corporations and other enterprise customers. Others said it was game over for Microsoft.

«Android is just getting started. It’s going to be very dominant,” said Bill Gurley, a general partner with Benchmark Capital. Since Google’s open-source Android operating system is free to use, that has led to a lot of experimentation and cost reduction in building devices, he says.

Gurley sees Google’s Android expanding beyond tablets and smartphones and into TVs, home appliances and cars.

«It’s just a tsunami,” he said. «What Google is doing with Android … it’s going to destroy so much market cap. It’s already happened to RIM and Nokia.”

Android smartphones have taken significant market share from BlackBerry maker Research In Motion (RIMM) and Nokia (NOK), causing their stocks to dive.

Meanwhile, Microsoft is on the sidelines because Windows 8 «doesn’t exist» yet, Gurley said. The next milestone for Windows 8 is the release of a beta test version slated for late February.

Jim Wong, president of computer maker Acer, says Windows 8 tablets will be successful with corporations and enterprises that want more productivity-centric devices. Microsoft will be able to provide its familiar Office productivity apps for Windows tablets and link to Exchange email servers.

«I envision a few years from now that Windows is going to be more successful with the corporate accounts» with its tablets, Wong told IBD.

The tablet market is evolving at a blistering pace, Wong says. «Eighteen months in the development of tablets is just like 20 years of the PC industry,” he said.

Google Executive Chairman Eric Schmidt says more than 200 million Android devices are in use. And 700,000 new Android devices are being activated every day, he says.

«Android, in my view, is on a billion-unit path,” Schmidt said at CES on Tuesday.

A longtime critic of Microsoft, Schmidt discounted the chances Windows has in the market.

«Microsoft is trapped in an architectural transition problem that they may not get through,” he said. «Oh, I’m so sorry,” he added facetiously.

Some exhibitors wondered Tuesday about potential replacements for the high-profile pre-show keynote speech that Microsoft executives have long delivered, with Google being perhaps the best choice.

Coupled with the growth of mobile devices, featured prominently at other shows such as the Mobile World Congress, there’s also the question of whether CES may be at its peak in terms of influence.

«You look at something like the Mobile World Congress, and with the rise of smartphones and tablets and other portable devices, you’re going to see some draw away for CES for companies that are focused specifically on those areas,” said Kurt Scherf, principal analyst for research firm Parks Associates. «It’s probably at the peak point of where it’s going to be.”

Organizers said Tuesday that the show opened with a record 3,100 exhibitors. This year’s event, which runs through Friday, features for the first time a startup-specific exhibit called Eureka Park, and smaller to midtier companies may be where the growth lies for the decades-old event.

«The companies who get their share of publicity on a regular basis have less of a need for CES,” said Jeff Kagan, a tech analyst based in Atlanta. «Therefore, many larger companies will either pull out or scale back.”

Microsoft said in December it would no longer deliver the keynote or have a booth at CES after this year because the January event date doesn’t align well with its product announcements.

«I think that’s more of a sign of Microsoft’s issues than the Consumer Electronics Show’s issue,” said Kevin Semcken, chief executive for Wheat Ridge-based headphone maker Able Planet, which has exhibited at CES since 2006.

In introducing Microsoft CEO Steve Ballmer for his final keynote Monday, Consumer Electronics Association president Gary Shapiro said the software giant is merely taking a break from the show.

«I would be shocked,” Shapiro said, «if a Microsoft leader does not return to the stage again in the next few years.»

Meanwhile, Yahoo, which has struggled with corporate and financial problems, was the third-most-visited website, trailing behind second-place Facebook.

The Nielsen study showed that Google was the most-visited website in 2011, with an average of more than 153 million unique visitors per month. Facebook was second with more than 137 million, and Yahoo was third with 130 million.

Microsoft sites, including MSN, Windows Live and Bing, came in fourth with nearly 116 million unique monthly visits. Google-owned YouTube rounded out the top five with more than 106 million visits.

«I’m surprised at how close the top four are,” said Ezra Gottheil, an analyst with Technology Business Research. «I think it reflects the fact that many people visit several [sites], or all of them.» The list also shows how valuable Yahoo still is despite the corporate problems the company experienced in 2011.

Yahoo, which has fallen from its once lofty position as an Internet pioneer, has been in a state of flux. This past September, with revenues falling and some top talent leaving, Yahoo’s board of directors fired then-CEO Carol Bartz.

Once Bartz was out, speculation bloomed that Microsoft, which made a failed bid for Yahoo back in 2008, is once again looking to scoop up Yahoo. And then talk began that Google, possibly just to keep Yahoo out of Microsoft’s clutches, was also interested in buying Yahoo.

Gottheil noted that even though Yahoo is in a state of flux, it’s still drawing in a large number of users. «Most people don’t stop using something that works for them,” he added. «They might add another service, but that doesn’t mean they eliminate an old one.”

For social networks, Facebook was the top dog in 2011 with more than 137 million unique visitors per month, according to Nielsen. Blogger.com came in a distant second with nearly 46 million, and Twitter was in third place with more than 23 million. WordPress, with more than 20 million, and MySpace, with nearly 18 million, rounded out the top five.

Google’s new social network, Google+, was in the eighth spot, even though it didn’t launch until late June.

While some may have expected Google+ to grab a higher spot on the social networking list, Gottheil said the new network could just be slowly ramping up.

«Google+, for a lot of people, just has not been sticky enough,” he added. «That doesn’t mean it won’t eventually develop a larger loyal following, but one of the consequences of Google’s big intro was that many of its original users were just window-shopping. Facebook, for all its recent rapid growth, built up gradually … It’s the network effect. Each additional user increases the value of the service to every other user.»

The bank on Tuesday launched a Facebook application that lets users team up to use their points, whether it’s for charity, a group gift or a personal goal. Citi says it’s the first bank to offer such a feature.

The app builds on a service Citi introduced last year that lets customers transfer points to one another on the bank’s homepage. After getting feedback, executives decided to expand the rewards sharing capability and offer it through social media.

«Now we’re delivering it to where customers are every day,” said Ralph Andretta, who heads Citi’s loyalty programs and co-branded cards.

Andretta noted that customers will have far more flexibility with their points, whether it’s to help a friend fly home from college or team up for a big-ticket reward. The company is giving away 2,500 free rewards points to each of the first 4,000 customers to sign up.

To get started, customers download the ThankYou Point Sharing App, which is linked on Citi’s Facebook page at www.facebook.com/citibank.

Customers can then start a rewards pool by naming a recipient and explaining its purpose. The recipient of the points maintains control of any contributions, so it’s best if you know and trust that person.

Pool recipients must be individuals and cannot be an organization, even if the intended goal is a charitable donation.

Users can promote their goals by sharing links on their Facebook pages or privately inviting other Citi customers to contribute. Donors can see the total number of points a cause has amassed.

The app can collect personal information from Facebook profiles. But Citi says it does not share any customer account information with Facebook.

The program isn’t only for credit card holders either. Citi checking account customers can also earn ThankYou points. Citi introduced its lineup of ThankYou credit cards last year.

Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

How Microsoft plans to make money from Skype is a question many have asked since Microsoft announced intentions back in May 2011 to buy the VOIP vendor for $8,5 billion.

Microsoft execs themselves have been pondering the issue, too, though they’ve given few concrete clues about their intentions.

On December 6, however, Charles Songhurst, General Manager, Corporate Strategy (and the guy who supports Microsoft top brass in analyzing large merger and acquisition transactions, noted during a Q&A session at the NASDAQ OMX Investor Program event in London, did provide a bit of guidance.

Core video chat technology between individual consumers will likely remain free, Songhurst indicated. But some of the Skype video technologies with more corporate appeal — say, capabilities like archiving and authentication — may not.

Here’s a transcript of Songhurst’s answer to an attendee’s question about Microsoft’s Skype strategy, going forward:

«E-mail is a good analogy to the video business. So, if you look at the e-mail industry, the consumer e-mail business has always been one where the core products are given away for free. So, you look at Hotmail and its competitors like Yahoo and Gmail, and then you look at the business side of e-mail. You look at Outlook and you look at its competitors. That’s always been a very good and very profitable business for Microsoft.

«You’re going to see the same dynamic in video where consumer video conversations have the same dynamic as consumer e-mail. It’s a product that is free, and it’s likely to stay free. In the enterprise you’ve got a very compelling opportunity around archiving and authentication. There’s a stat that’s approximately 29 percent of Fortune 500 employees use Skype without it being installed from their CIO. So, if you think about giving the CIO the ability to archive those conversations, to authenticate them, to have the same controls over that conversation that they do over their e-mail, that the employees have, you’d have a very compelling proposition.”

(Songhurst, by the way, is considered to have been CEO Steve Ballmer’s right-hand man in the Skype acquisition.)

Microsoft execs have said they plan to integrate Skype throughout Microsoft’s product line — everywhere from Hotmail and Xbox, to the company’s Lync unified communications server/service and Windows Phone. (A Windows Phone Skype client was on Microsoft’s 2011 delivery list, but still has yet to materialize. I wouldn’t be surprised to see this pushed back to 2012.)

One other interesting tidbit from the transcript of Songhurst’s December 6 remarks: Even Microsoft’s highest-ranking and most influential execs are forbidden from saying almost anything about Windows 8. They can’t even restate or refine Windows 8 information that’s already been shared by the Windows client team.

Songhurst told attendees that Windows 8 was the topic he could say the least about «because we’re very careful in what we say about Windows 8.”

“(W)e really don’t talk about Windows 8,” Songhurst repeated when asked another question which touched on the topic.