Re: Is this skin cancer?
It might be, and then again, it might not be. If it is a type of skin cancer, it would probably be squamous or basal which does affect the elderly most commonly and can be taken care of fairly easily. Either of these cancers are not typical fatal.
Have your father see a dermatologist and get a look see. If it is something unusual, the dermatologist will schedule a biopsy (or do one that day). If it is cancerous, there will be a portion of skin removed from the area, and a bit of plastic surgery will need to be done to make the area less noticeable. Believe me, at your father's age, this is not all that uncommon.
Good luck, and keep us posted!