Microsoft showed off a beta version of a real-time, spoken-word translation service for Skype calls on Tuesday. Gurdeep Pall, Corporate Vice President of Skype and Lync at Microsoft and the company's CEO Satya Nadella on Tuesday at the inaugural Code Conference in Rancho Palos Verdes, Calif., Gurdeep Pall, demoed the new Skype Translator app.

The app allows speakers in different languages to hear the other's words spoken in their own language. It being developed jointly by the Skype and Microsoft Translator teams. The demo showed near real-time audio translation from English to German and vice versa, combining Skype voice and IM technologies with Microsoft Translator, and neural network-based speech recognition.

"It is going to make sure you can communicate with anybody without language barriers," said Nadella.

For the demonstration, an English-speaking Microsoft executive was chatting with a German counterpart. However, German-speaking audience members said the translation was good enough for casual talking, but not for business.

Skype Translator first will be available as a Windows 8 beta app before the end of 2014.