This release or innovation from Microsoft looks interesting, the only drawback is that the speakers would need to be concise / precise with their use of language (lazy speech habits, and slang-type phrases could pose problems for this speech software)
With the introduction of this 'innovation' from Microsoft, the old adage: 'the world is gettingsmaller' has never been truer.
Real-life starting to mirror science-fiction? With this concept, it most certainly is.
There's been translator apps utilizing voice and speech on the market for some time now, so this isn't really a new innovation, but rather a fresh addon for Skype. It's all very clumsy software ATM but it's not going to take long until speech recognition becomes advanced enough to catch “lazy speech” properly. What's more challenging is to make the software smart enough to translate the structure of the sentences in a proper way, without autocorrecting the actual meaning of a message.
Interestingly you mention the 'auto-correct' function; even within English speaking countries there are countless differences in the meaning or use of words, and sentence-structuring.
The differences in Australian / British, and American usage are markedly so. I'll assume the software Microsoft is using will be programmed, and based upon American 'english'.
The problem is that Microsoft is now abandoning the main Skype development unit, because Microsoft, Google and Adobe have to leave Russia, and the main Skype development is done in Russia.
Microsoft itself doesn't use Skype internally, they use Jajah, an Austrian VOIP provider, for their internal communications. That should tell you enough about how private Skype is...