Skype Translator allows almost realtime translation, so you can chat to your Skype contacts in different languages (currently 4 are supported). It's a 'preview' that you can download now on Windows 8 and above, which means while its stable enough for anyone to try, but is still unfinished and in-development.
Near-real time voice translation
A standalone version of Skype, Skype Translator allows you to translate between 4 languages: English, Spanish, Italian, and Mandarin. All you have to do is speak and, after a short pause, Skype will translate what you or your contact have said into the target language. Your contact will hear what you said, translated and spoken by a computerized voice.
Skype Translator also shows a transcript of your conversation - especially useful in case where the app has mistranslated something. As it's a preview, this is an app which is still learning, so you can expect some errors in translation, although it's still an impressive technology.
Voice and text
To use the translator, all you do is turn the feature on and choose the language of the person you are talking to. Skype Translator will then translate your conversation. It's not perfect, but if you use a headset (to decrease background interference) and try to speak clearly, the results are surprisingly good. Skype Translator also offers translation for a further 46 languages for text only, so you can instant message on Skype in lots of languages. Skype Translator is easy to use, especially if you're already used to Skype itself, as the interface is almost identical.
A step towards the future
Skype Translator sounds like an app from the future, but the reality isn't quite as smooth as you might imagine. Both parties have to be patient and speak clearly for the system to work. If you have Windows 8.1 or Windows 10 preview, you should definitely try out Skype Translator.