'The day Skype died' revisited

Sometimes you realize you’ve written a weak post too late. It was my case with yesterday’s annotation.

I thought nobody would even read it. But it seems that, because of a trackback at Gmail Blog, I was wrong.

Fortunately, Matt Sealey (thank you, Matt), was kind enough to comment, pointing out one of the weakest parts. He says that Google’s movement only affects a portion of Skype’s services. With Gmail you won’t be able to call to real phones (he says “yet”). And so Gmail isn’t a fully replacement of Skype.

That’s absolutely true.

It’s also true that Google’s plugin to get the Video Chat isn’t available for Linux.

And it’s also completely true that many email accounts are not Gmail. Hotmail and Yahoo accounts are very popular, probably more than Gmail. And through Windows Messenger you could make voice and video calls.

What I was trying to say is that the Google’s movement is “good enough” to defeat Skype. And that this movement seems part (or let’s say “could be part”) of a larger strategy. Let’s try to explain the first and left the larger strategy to other post.

We have a free Skype-to-Skype, because there are others services that make the money. This revenue comes, among other things, from SkypeOut minutes, which is a non-free service to call (at a rate) to real phones (whether land or mobile based). Rates of SkypeOut minutes are cheaper than traditional phone companies, in particular when you call to other countries’ phones.

But there are many companies that provides similar services. In Spain, you can even buy cards that allow you to make long distances call at a cheap rate. In fact, because of VoIP (“calls through Internet”), international calls through traditional phone companies are much cheaper now than five years ago.

What made Skype different to the other companies is that with Skype you had in the same place calls Skype-to-Skype free. It was like a communications centre.

However, there was a trend already in place where calls to real phones from Skype were fewer. I think that’s because cell phones are a pervasive technology in many countries and, at least in Spain, you call Skype-to-Skype if you’re at home and it’s just talk, or use your cell phone if you’re away.

Going to Ebay’s third quarter results, and looking at revenue per user and Skype-to-Skype minutes, we see that while users and Skype-to-Skype minutes grows (in a way that the make Skype-to-Skype minutes per registered user without trend), the revenue grows much less (in a way that it can be seen a falling trend on the revenue per registered user)

2007-3 2007-4 2008-1 2008-2 2008-3
Registered users (million) 245,7 276,3 309,3 338,2 370,2
Revenue (thousands) 93823 110364 119791 130151 137201
Revenue per user (calculated) 381,86 399,44 387,30 384,83 370,61
Skype to Skype minutes (millions) 9,8 11,9 14,2 14,8 16
S2S minutes per registered user 0,040 0,043 0,046 0,044 0,043

Before Google’s movement, Skype already needed to rethink about it’s future, from a business point of view.

Now comes Google with its offer. And then, you (as a user) have two options.

Install a program, and try to convince the people on the other side to do the same, just for the case you want to talk to them…

…or do it from your browser, with your contact lists already there.

Yes, I know that it seems there’s not many differences. With Google you have to install a plugin.

But I see it very different. First, because a plugin is less frightening for many people. But second and much more important, because you already communicate with that people through Gmail.

That’s Gmail’s power. Gmail is now THE communications centre. You can communicate asynchronously (with mail), nearly synchronously (with text chat), and in real-time (with video and voice). From your browser.

First published here