The iPhone 5s captures beautiful images at 8 megapixels. What makes them beautiful is a redesigned camera sensor that allows for bigger pixels. Bigger pixels equal better photos. And better photos are precisely what inspired the advancements that Apple made with the new iSight camera on iPhone 5s. https://www.apple.com/iphone-5s/camera/
If you would like to install the update, you should delete the Skype app from your iPhone. Then find Skype in the app store on the iPhone, touch the cloud with the downward arrow, and version 5.0 will download to the iPhone. You will need to log in.