I did it by disabling it in Services. I'm still using Windows XP Home SP2 so some of these instructions will be different for those of you using newer versions of Windows; so how ever you get to the "services" list is the process that you will use.
For XP Home SP2:
Go to the Start menu in the lower left corner of the screen and find and click on Administrative Tools; now look for the Services listing, click on that; a new window will open showing all the services currently running; look for "Skype Updater" in the list (it's alphabetized). Right mouse click on the "Skype Updater" entry and click on properties in the drop down list, a new window will open showing you the properties of that entry; change it's status to disabled using the drop down menu next to the line that says "Start-up type" Close the services window and any other open windows and reboot' this solved the issue for me.
In the alternate, try using a small program called "Autoruns" found here:
install and run the program by extracting the files in the provided zip folder to a place on your hard drive of your choosing; once the files have been extracted, close the zip program and go to the folder where you placed the files; open the folder and look for autoruns.exe and create a shortcut to your desktop or pin it to your start menu; launch the program and look for the Skype entry under the "services" tab; look for the updater line and undo the tick mark; close the program and reboot.
You should be good to go. Hope this works for all who try it.
I have written a blog post on how to disable Auto Updates in Skype when you are packaging it for silent installation:
I am really displeased with the new skype. How do you turn off auto updates?
I have updated my post with a more appropriate solutiion. Please have a look here:
Copy and paste the blue line above.