Skype press releases, and news items containing links to Skype personnel.

There are great lessons to be learned from a quick study of "Hyping Skype". Over two years, Skype went from releasing a beta product to a successful billion dollar sale. I've put together two quick charts on a rough timeline to share Skype PR releases and some of the lessons learned and gathered along the way. It's a much bigger story than just a couple of PPT's.

I've lived through these lessons and been part of them in many ways. I blogged Skype from the beginning. Over the next few days I plan on sharing a few of the lessons. In the end, the Skype community has been pivotal in determining Skype's direction and creating a momentum far beyond it's size. We are at a very clear inflection point for Skype. Will the momentum continue? Will the elements that made them so successful in Year One and Year Two translate effectively to an eBay managed world?

Year One.

Year Two.

Skype released a major version of their software for Windows today, Version: 1.4.0.71. Download. Big features for users:

• Call forwarding
  
• Accessibility improvements to the contact list
  
• 26 new or updated language files (Swedish, Finnish, Danish, Norwegian, German, Dutch, French, Italian, Portuguese Brazilian, Hebrew, Russian, Polish, Spanish, Estonian, Japanese, Greek, Chinese Traditional, Chinese Simplified, Korean, Romanian, Turkish, Arabic, Korean, Hungarian, Bulgarian, Czech)
  

Features for programmers:

• API: data channel
  
• API: write to profile
  
• API: call forwarding controls
  
• API: expressive content (ringtones, avatars)
  

The Skype change log and official news release...

28.09.2005 version 1.4.0.71

* feature: Call Forwarding
* feature: Skype Test Call Service prepopulated to Contact List for new users
* feature: 21 new emoticons
* feature: My Pictures: possibility to choose pictures from Expressive Content
* feature: RingToneManager for Expressive Content of audio files
* feature: Contact List accessible by Microsoft Active Accessibility
* feature: API: application-to-application communication
* feature: API notifications for contactlist selection and focus
* feature: API: set profile information
* feature: API: call forwarding via API
* feature: API: support expressive content files SET RINGTONE and AVATAR
* feature: API: added OPEN [PROFILE | USERINFO | CONFERENCE | SEARCH | OPTIONS | CALLHISTORY | CONTACTS | DIALPAD | SENDCONTACTS | IMPORTCONTACTS | BLOCKEDUSERS | GETTINGSTARTED | AUTHORIZATION ] commands
* feature: multilingual EULA
* feature: advanced Skype links
* feature: number of friends displayed in Profile View form
* feature: possibility to set connecting sound from Options
* feature: added dynamic messages for help and tips
* feature: possibility to select and copy profile fields
* change: new layout for Getting Started Wizard
* change: Search window redesigned
* change: Add friend window redesigned
* Change: Import Contacts redesigned
* change: quicksearch on addressbar improved
* change: improved call related error messagas
* change: 'minimize' button minimizes Skype to taskbar
* change: warning dialaog added when calling to SkypeOut using callto: links
* change: option to disable authorization message popups
* change: MSN contact importer removed from Import Contacts
* change: upgrade prompt supressed if installer is launched with SILENT or VERYSILENT option
* change: removed latin spanish language
* change: option to view online release notes after installation removed
* change: option to create a Quick Launch icon removed from installer
* change: explanatory text in Profile View if user has not been online recently
* change: month names in Profile are translatable
* change: options dialog is changed to nonmodal
* change: Send Authorization dialog is changed to nonmodal
* change: main window minimum size changed
* change: new language files - Swedish (Anders Olsson), Finnish (Heino Keränen), Danish (Mathias Schwarz), Norwegian (Stig Auestad), German (Claudius Henrichs & Dick Schiferli), Dutch (Kees Koenders), French (Fabrice Imperial), Italian (Conte Daniele), Portuguese Brazilian(Anna Nyström ), Hebrew (Ronen Ben-Naftali), Russian (Viktoria Randalainen/Tatjana Kruti), Polish (Ewa Czekalska/Karol Szastok), Spanish - (David Reche), Estonian (Eve Loopere), Japanese (Tomo Suzumaru(Livedoor)/Mayu Shimizu), Greek (Panagiotis Sidiropoulos/Magenta LTD), Chinese Traditional (Morden Chen/PChome Online), Chinese Simplified (Leon Yang/TOM Online), Korean - (Daum Communications Corp), Romanian - (Paraschiv Ion & co), Turkish (Emin Dede) Arabic, Korean (Eriksen Translations Inc), Hungarian (Mark Bender), Bulgarian (Nikolina Filipova, Nikolay Filipov) Czech (Petr Silon)
* bugfix: shortcut to desktop - dropped always, despite preferences
* bugfix: changed sound channel usage,therefore improving the stability on older operating systems
* bugfix: improved Multi Chat behaviour on multiple monitors
* bugfix: authrequests do not pop up if your status is Do Not Disturb
* bugfix: optimized loading of user-language file
* bugfix: optimizations to have faster log-in
* bugfix: improved unicode handling on win98
* bugfix: status was incorrect in chat titlebar when disconnected
* bugfix: improved URL parsing in chat
* bugfix: addressbar search updated when new contact added
* bugfix: 'start skype when windows starts' option will revert to default
* bugfix: 'Enable All Sounds' option missed one checkbox in Options dialog
* bugfix: wrong folder created to Documents and Settings when changing avatar
* bugfix: toolbar texts not visible on clean install
* bugfix: improved error handling when selected sound file is too big
* bugfix: keybaord navigation in language editor
* bugfix: Ctrl+F in chat window shows non-active main window
* bugfix: toolbar buttons were not updated on some cases
* bugfix: API: Error is returned if OPEN ADDAFRIEND command has too many parameters
* bugfix: API: Using query id messed up replies to NAME and OPEN FILETRANSFER commands
* bugfix: API: During voicemail recording SEARCH ACTIVECALLS returned call id
* bugfix: API: When offline user tried to make a call with query id, error was returned without query id
* bugfix: API: Contactlist change notifications were sent when focused contact actually did not change
* bugfix: API: Other API messages were sent before “attach success” message

SKYPE EXTENDS LEADERSHIP POSITION WITH NEW MUST-HAVE RELEASE

New Features Encourage Callers to Upgrade to Move Beyond the PC,
Be More Sociable and Express Themselves in More Ways

(Luxembourg 29 September 2005) - Skype, the Global Internet Communications pioneer which makes it possible for anyone to make free, high-quality phone calls via the Internet to anyone worldwide, today extends its leadership position as the most innovative and fastest-growing Internet communications offering with the release of the latest version of its award-winning software. This announcement is significant both for Skype's existing callers who can now upgrade to new and powerful features and also for people new to Skype who can experience an even simpler way to start making phone calls for free.

The new Skype for Windows offers callers everything one would expect from an Internet phone and more, including increased mobility options, new ways for callers to personalise Skype with original ringtones, sounds and pictures, better than ever sound quality, as well as more ways to be sociable by making it easy to find and connect to their friends, family and colleagues online.

"Skype pioneered free Internet phone calls, and even with more than 56 million people already registered, we've recently seen our growth accelerate to over 170,000 new registrations a day," said Niklas Zennström, CEO and Co-founder of Skype. "We are passionate about really understanding what motivates people want to make Internet communications a part of their everyday lives, and listening to our callers about what they want from Skype allows us to stay ahead of the game. Today, we are thrilled to be delivering on this promise by offering a new version of Skype which both new and existing callers will find adds powerful and innovative new features like call forwarding and personalisation, as well as offering our best ever sound quality on our simplest product to install and use."

Skype recently embarked on a comprehensive global survey to deepen an understanding of how Internet communications is used by people around the world and what they expect from next-generation personal communications services. According to the independent study, Skype is used once or several times a day by 76% of its callers, far surpassing the usage levels of traditional IM-based voice calling services. Callers also recognized Skype's leadership in sound quality - 72% of Skype users consider call quality to be good to excellent. Skype callers are more international, with 85% communicating with people living abroad. Skype's broad base of early adopters are eager to embrace new features, with 79% interested or very interested in receiving calls from landlines, and 73% interested or very interested in adopting call forwarding, key innovations unique to Skype.

The new Skype for Windows Version 1.4, which was first available in beta in August, incorporates two new premium services requested by Skype callers, and fortifies Skype's role as a preferred complement to ordinary cell phones and landlines. It builds on Skype's already extensive product offering which allows people to instant message, set up group chats, make conference calls, transfer files, send and receive voicemails, call and be called from a traditional phone system, and access Skype over Wi-Fi for extremely low rates.

Skype's new Call Forwarding service will allow callers to forward incoming Skype calls to another Skype Name or up to three landline or mobile numbers when they're away from Skype, at no cost to the caller. Anyone using Skype may forward their calls to another Skype Name free of charge, or forward to traditional phone numbers at low SkypeOut rates. 83% of beta testers who have tried Call Forwarding have found it easy to use.

Skype's new Personalise Skype features also allow callers to easily express themselves with original pictures, sounds and ringtones for as little as 1 euro ($1.20). This new feature opens up a new and exciting market for content providers looking to deliver great applications to Skype's global callers and is initially offered in partnership with American Greetings, Qpass and Wee World. The global ringtone market is forecast to grow to $5.2 billion in 2006, and ringtones now account for over 10% of the $32.3 billion worldwide music market (Arc Group).

The new version of Skype makes it even easier for callers to extend their social network. It's simple for callers to search Skype's Global Directory, and import personal contacts from Outlook directly into their buddy lists. With the Skype Toolbars, users can make one-click calls to numbers and Skype Names from Internet Explorer and Outlook, adding tremendous value to popular desktop applications. Advanced Skype buttons allow webmasters and bloggers to create links that instantly initiate Skype actions, such as conference calls and chats.

It takes less then 3 minutes for new callers to get started with Skype, even if they are not Internet-savvy. A friendly 'Getting Started Wizard' means it's easy to begin enjoying the cost and quality benefits of the new Skype, available immediately for download at www.skype.com.

Skype Journal begged Skype to share their near term product roadmap with independent developers. Recently they've started to do just that, in private forums for their beta developers, at meetings of their developers' advisory board, and last night at their "Skype Night" for developers meeting at VON Boston. Normal caveats: everything is subject to change, we don't know what the new feature names really mean, and this all comes out for Windows first.

Here is the chart as projected for the audience.

Details from that slide.

The current release is 1.3, so 1.4, now in beta, is coming up in September. It will include better people search, help, expressive content (ring tones and the like) and basic call forwarding. UI and usability improvements: Improved GSW (my neighborhood emergency room uses this term for gunshot wounds), Improved Search, Improved Import Contact Wizard, Web Based Visual Setup Guides, Basic Dynamic Content (?), Login-by-Alias (?)

1.5 adds video (?), client-side web presence, and partner bulids (?) in October.

1.6 is the Novemer 2005 "Community Release." New: Simple Talk (client-side) and talk directories, social networking (?), dynamic content (http), and removing bloat from the client's software libraries.

Release 1.7 will feature "Talks and PIM" in December-January. New features: advanced talks on the client side, editable profiles and enhanced video. UI and usability: UI 2.0 (phase 1) and dynamic content p2p (?). On the web: tools for webmasters and blogs.

Unscheduled items: PTT, user rewards program, offline IM, shared groups, video mail, expressive content (phase 2), and phase 3 importers .

I remember Howard telling me the story of tracking down Skype. I was certainly envious, I learned he had almost a year to work with the lads before I downloaded the first version. Having met Niklas and Howard, it was easy to see how this hidden partnership worked. I've learnt a lot as a result and about how Silicon Valley works. Congratulations Howard! It's quite a story.

Together with his partner (Howard) Hartenbaum, Draper invested about $250,000 into Skype in late 2002. They became the first outside investors, and enjoyed a 5 percent stake. (And while the exact numbers aren't known, they invested when Skype was valued at less than $2 million -- meaning they've seen close to a thousandfold return.) MercuryNews.com | 09/15/2005

So what next Howard? Will the ecosystem get some investments? I'm ready to talk the next big thing!

Where are the best blog entries on eBay and Skype? Well, Alec Saunders has a great collection. Start here with "The Skype Webcast" through to "Roundup: Skype / EBay part deux".

Similarly, by yesterday the larger publications chimed in - informed by the blogworld. Red Herring "Deal Blow to Telcos" and Business week "Why eBay is Buying Skype".

While Richard reports the telco's don't get it, Neville reports on "Communicating the Power of Three"

Ok. stage one of the media blitz is over. There are now developer stories to write. Tips for eBayers new to Skype, new strategies for telecoms and the VoIP industry, and even Skype eBay PayPal.

James Enck pointed yesterday to a Morgan Stanley luncheon session for eBay Skype. You can listen to it here. The professionalism and understanding of Meg Whitman and Rajiv Dutta shine through this briefing. I can sense Meg's "marketing nous" and interest while Rajiv would appear to have been the detailed point man all the way through.

Two main underlying themes:
1) New ways to monetise ecommerce. Not just a transaction model. eBay with Skype create a lead generation opportunity in pay per call.

2) Reduces friction. Earliest friction was trust and safety. second was description and the need a picture. Payments before PayPal another friction. Shipping now enhanced so you can download postage etc handling reduction.

Two weeks ago, I explained how Google needed Skype to move Google up the value chain from when an advert is clicked. I noted that eBay was Google's real competition for connecting consumers to merchants, and eBay has a structured transaction environment. They don't just do the search, they also help complete the transaction, including payment.

So, a fortnight later, and eBay buys Skype. What does it mean?

Companies like Dell, eBay, Google, etc. got big by thinking big. They picked a unique business model, and drove it to completion without losing focus. To understand this transaction, you need to look for where the big prizes are.

The obvious one is the wrong one. Google and eBay are already in the business of generating sales leads. The Skype community, for all its size and vibrancy, is not being bought because they can be pitched to and turned into eBay users. Or if it is, this story will have a nasty ending where all the heroes get bumped off and the princess just grows old and ugly.

There are two conveniently located stones under which to look: transaction revenue, and the freefone number business.

Banking is big, slow, cartel-like and lacking in innovation. eBay is unbundling part of the transaction chain using Paypal, and re-intermediating the settlement process. Remember that Paypal is largely a virtual payment mechanism, used to front other payment services. Communications services are a natural generator of the small transactions that Paypal thrives on due to its low comission fee structure compared to credit cards. Skype and Paypal also have an international footprint, leaving many parochial banks struggling to offer a competing product. They fit together nicely.

This is classic Innovator's Dilemma stuff. Eat your way up into the big boys' businesses by starting with the small stuff.

So the first big prize is to suck some of the profit out of the banking payments system. This is a big pool, and Skype is just a small straw. That makes the eBay/Skype transaction interesting, but not critically important.

Guess what? Telecom is big, slow, cartel-like and lacking in innovation. And it has some big prizes ready for snatching. Almost all of current retail VoIP plays are abount disintermediating high end-user toll charges. It's a massive race to the bottom, where you get your monthly talk time by cropping three coupons off your Shreddies packet.

There are other puddles of money in telecom, though. One is the 800 number revenue bucket. I don't have the figures to hand, but this isn't a small deal. And because Skype is a child of the "stupid network", it can evolve quickly to integrate new transaction-supporting functionality making the profit pool bigger.

I suspect that eBay's ambition is to become the mediator of 800-number style interactions between consumers and merchants. The www.ebay.com web site is their text distribution channel, and Skype is the audio one. Each will have different sets of merchants, buyers and transaction structures. So don't look for "eBay" functionality to appear in Skype, because they're addressing strategically similar but functionally different needs.

One last thought. If you're a telco, now is a great time to cross your chest and start saying your Hail Marys. Someone with deep pockets is about to give away telephony to support their adjacent transaction business. Browsers are free — as long as enough people tip Bill G., search is free — as long as enough people leave a few cents in Larry, Sergey and Eric's pension plan. And telephony will be free — as long as you click the "pay here" button on your Skype-powered eBay telephony device often enough.

PS - eBay still hideously overpaid given the size of the effort needed to claim the prizes.

I asked my contacts "What does the eBay purchase mean for you and or your company?"

From Taiwan. A manufacturer of Skype hardware. He wouldn’t let me use his name.

"Actually, our eBay experience is terrible. I truly wish they (Skype) can become better... every email we sent to them is just like throwing a stone to the ocean. That is why I do not see any difference having eBay buy Skype."

From Sweden. Ben Isacsson:

"Yes a very, very new culture will emerge. At least for me. I will stay (with Skype) for a while - but only until I find a non US-owned program."

From South Africa. John Sjolund

"To be honest I do not really think that it will impact our business much. We use Skype all the time in our business and love it. I am confident that this move will only mean that the product gets better.

I think that it could involve very interesting revenue generating opportunities for other businesses through the use of papal credit as opposed to Skype credit. I think the incorporation of PayPal is golden.

I am hoping that they don't move it into an exclusively North American thing now however.

I am very excited by the prospect. I listened to the eBay webcast and was very impressed with the eBay people.

From the UK. Robin Batt, marketing consultant in VoIP space.

"I'm amazed and astounded. It doesn't make any sense at all! I just heard the news and am thinking it thru give me a few minutes....

Well, first off, I guess that marks the end of the Internet ‘crash’ – or the beginning of a whole new bubble. Good news for the Internet industry (that someone would pay 2.6 BN for a company that's not yet turned a profit and only just starting to generate any revenue at all)

I have to say I can’t quite see the logic behind the marriage. Sure they can cross sell into each others' communities, but Skype hasn't exactly experienced problems with customer acquisition (maybe eBay has - I dont know). If this is all about enabling eBay buyers to talk to each other - and generating additional revenue from the voice calls, then:

a) I don’t see why they would buy Skype - why not build their own P2P voice functionality

b) I can see that generating some additional 'net new minutes' - but I don’t know that eBay users need to talk to each other, or how many would pay to do so (to justify that kind of a purchase price)

I might be being shortsighted, but I don’t quite get it. All of eBay's other recent acquisitions have been in the marketplace/ecommerce space – logical. Perhaps eBay were simply feeling left out of the VoIP hype/race with Google, Yahoo, Microsoft etc.

Also, it'll be interesting to see what they do with the brands....2 very powerful brands, but with really quite different brand values."

From Prague, Czech Republic. Robert Hernandez, a developer of a Skype enabled product for Columbus CRM.

"Skype has undoubtedly fused with one gigantic community and infrastructure, ready to take on those 'other camps' currently making a lot of noise. If Skype's current partnering model holds up, we see great opportunities in relationship management and all the ideas going around this. This is 10+ in our scale."

From the UK. Marcus Williamson. Connectotel, the developer of a Skype SMS product.

"We hope that eBay's acquisition of Skype will mean a timely solution to the issue which all developers of services on Skype face, namely how to bill for services on the Skype network. As the owner of Paypal, Ebay already has expertise in the area of payment systems and has a well-defined eBay API and Paypal API. The next step for Skype/eBay should be to provide a payment API to allow developers to credit or debit a user's SkypeOut account for micropayments. Skype/Ebay would benefit by taking a percentage of each transaction, as Paypal already does.

Paypal API info:
Ebay API info:

From the UK. Martin Schoenenberger. Skype User and Swiss Investment Banker.

"Through this acquisition eBay gains a strong foothold in the the rapidly growing VOIP market. By joining the eBay, Paypal and Shopping.com platform, Skype will be able to aggressively expand their user population. The synergies will be enormous."

From Estonia and Skype. Jaanus Kase, Blogger for Share Skype.

"A large part of the deal is the promise that Skype will stay independent, just as PayPal has. They got acquired by eBay some years ago but they're still operating fairly independently, joining forces with eBay at places where it's good for users, just as Skype will do. (Quote from Skype Forum: )

From the Skype Forum. Judging by the early feedback on the Skype Forum, it looks like a lot of people care. The results of the early poll (monitor it here ) sum up many of the comments so far by participants on the Skype Forum.

In your mind, is the eBay acquisition of Skype a good thing?

• Yes - 29% (8)
• No - 70% (19)
• I don't care - 0% (0)

Despite the negative poll numbers, most see it as an opportunity.

From Canada. From me...

Many questions are answered in this eBay financial disclosure (pdf download). For an overview of the purchase visit this eBay investor relations page.

So eBay buys Skype. Who cares? I do. The road for the next year will be tough as cultures merge and evolve, but the end result will likely be very positive, as many developers above indicated. Skype will likely get the resources it needs to compete.

This is a shock. It touches all us Skypers. It appears end users are worried about the change; but most business people are embracing the opportunity.

Deal done. Retail VOIP in the offing? Views later.

eBay has agreed to acquire Luxembourg-based Skype Technologies SA, the global Internet communications company, for approximately $2.6 billion in up-front cash and eBay stock, plus potential performance-based consideration.

Skype generated approximately $7 million in revenues in 2004, and the company anticipates that it will generate an estimated $60 million in revenues in 2005 and more than $200 million in 2006. For Q4-05, eBay expects the acquisition to be dilutive to pro forma and GAAP earnings per share by $0.01 and $0.04 respectively. For the full year 2006, eBay expects the transaction to be dilutive to pro forma and GAAP earnings per share by $0.04 and $0.12 respectively, with breakeven on a pro forma basis expected in the fourth quarter of 2006. On a long-term basis, eBay expects Skype operating margins could be in the range of 20% to 25%.

The acquisition is subject to various closing conditions and is expected to close in the fourth quarter of 2005.

eBay will host an investor conference call to discuss the announcement at 5 am Pacific Time today. A live webcast of the conference call can be accessed through the eBay's Investor Relations website at http://investor.ebay.com. An archive of the webcast will be accessible through the same link.

Full text of news release...

On Skype.com:

eBay to Acquire Skype

London, September 12, 2005 – eBay Inc. (Nasdaq: EBAY; www.ebay.com) has agreed to acquire Luxembourg-based Skype Technologies SA, the global Internet communications company, for approximately $2.6 billion in up-front cash and eBay stock, plus potential performance-based consideration. The acquisition will strengthen eBay’s global marketplace and payments platform, while opening several new lines of business and creating significant new monetization opportunities for the company. The deal also represents a major opportunity for Skype to advance its leadership in Internet voice communications and offer people worldwide new ways to communicate in a global online era. Skype, eBay and PayPal will create an unparalleled ecommerce and communications engine for buyers and sellers around the world.

“Communications is at the heart of ecommerce and community,” said Meg Whitman, President and Chief Executive Officer of eBay. “By combining the two leading ecommerce franchises, eBay and PayPal, with the leader in Internet voice communications, we will create an extraordinarily powerful environment for business on the Net.”

Founded in 2002 by Niklas Zennström and Janus Friis, Skype offers high-quality voice communications to anyone with an Internet connection anywhere in the world. The Skype software is easy to download and install, and enables free calls between Skype users online. Skype’s premium services provide low-cost connectivity to traditional fixed and mobile telephones. Skype’s software also offers a robust set of features, including voicemail, instant messaging, call forwarding and conference calling. Upcoming product innovations include Skype video, expressive content such as avatars, and customized toolbars for Outlook and Internet Explorer.

One of the fastest growing companies on the Internet, Skype already has 54 million members in 225 countries and territories. Skype is currently adding approximately 150,000 users a day and has created a thriving ecosystem of products, services, developers, and affiliates. Skype is considered the market leader in virtually all countries in which it does business. In North America alone, Skype has more users and serves more voice minutes than any other Internet voice communications provider.

“Our vision for Skype has always been to build the world’s largest communications business and revolutionize the ease with which people can communicate through the Internet,” said Niklas Zennström, Skype CEO and co-founder. “We can’t think of any better platform to fulfill this vision to become the voice of the Internet than with eBay and PayPal.”

“We’re great admirers of how eBay and PayPal have simplified global ecommerce and payments,” said Janus Friis, Skype co-founder and senior vice president, strategy. “Together we feel we can really change the way that people communicate, shop and do business online.”

Zennström and Friis will remain in their current positions. Zennström will report to eBay CEO Whitman and join eBay’s senior executive team.

A Powerful Ecommerce and Communications Engine

Online shopping depends on a number of factors to function well. Communications, like payments and shipping, is a critical part of this process. Skype will streamline and improve communications between buyers and sellers as it is integrated into the eBay marketplace. Buyers will gain an easy way to talk to sellers quickly and get the information they need to buy, and sellers can more easily build relationships with customers and close sales. As a result, Skype can increase the velocity of trade on eBay, especially in categories that require more involved communications such as used cars, business and industrial equipment, and high-end collectibles.

The acquisition also enables eBay and Skype to pursue entirely new lines of business. For example, in addition to eBay’s current transaction-based fees, ecommerce communications could be monetized on a pay-per-call basis through Skype. Pay-per-call communications opens up new categories of ecommerce, especially for those sectors that depend on a lead-generation model such as personal and business services, travel, new cars, and real estate. eBay’s other shopping websites — Shopping.com, Rent.com, Marktplaats.nl and Kijiji – can also benefit from the integration of Skype.

PayPal and Skype also make a powerful combination. For example, a PayPal wallet associated with each Skype account could make it much easier for users to pay for Skype fee-based services, adding to the number of PayPal accounts and increasing payment volume.

In addition, Skype can help expand the eBay and PayPal global footprint by providing buyers and sellers in emerging ecommerce markets, such as China, India, and Russia, with a more personal way to communicate online. And consumers in markets where eBay currently has a limited presence, such as Japan and Scandinavia, can learn about eBay and PayPal through Skype. Skype can also help streamline cross-border trading and communications.

With its rapidly expanding network of users, the Skype business complements the eBay and PayPal platforms. Each business is self-reinforcing, organically bringing greater returns with each new user or transaction. The three services can also reinforce and accelerate the growth of one another, thereby increasing the value of the combined businesses. Working together, they can create an unparalleled engine for ecommerce and communications around the world.

Transaction and Financial Information

eBay will acquire all of the outstanding shares of privately-held Skype for a total up-front consideration of approximately €2.1 billion, or approximately $2.6 billion, which is comprised of $1.3 billion in cash and the value of 32.4 million shares of eBay stock, which are subject to certain restrictions on resale.

The maximum amount potentially payable under the performance-based earn-out is approximately €1.2 billion, or approximately $1.5 billion, and would be payable in cash or eBay stock, at eBay’s discretion, with an expected payment date in 2008 or 2009. Skype shareholders were offered the choice between several consideration options for their shares. Shareholders representing approximately 40% of the Skype shares chose to receive a single payment in cash and eBay stock at the close of the transaction. Shareholders representing the remaining 60% of the Skype shares chose to receive a reduced up-front payment in cash and eBay stock at the close plus potential future earn-out payments which are based on performance-based goals for active users, gross profit and revenue.

The above-mentioned dollar and eBay share amounts are approximate, based on the Euro-Dollar exchange rate and eBay’s stock price as of September 9, 2005. The final value of the stock component of the consideration may vary significantly from this estimate based on the value of eBay stock at closing.

Skype generated approximately $7 million in revenues in 2004, and the company anticipates that it will generate an estimated $60 million in revenues in 2005 and more than $200 million in 2006. For Q4-05, eBay expects the acquisition to be dilutive to pro forma and GAAP earnings per share by $0.01 and $0.04 respectively. For the full year 2006, eBay expects the transaction to be dilutive to pro forma and GAAP earnings per share by $0.04 and $0.12 respectively, with breakeven on a pro forma basis expected in the fourth quarter of 2006. On a long-term basis, eBay expects Skype operating margins could be in the range of 20% to 25%.

The acquisition is subject to various closing conditions and is expected to close in the fourth quarter of 2005.
About eBay Inc.

Founded in 1995, eBay pioneers communities built on commerce, sustained by trust, and inspired by opportunity. eBay enables ecommerce on a local, national and international basis with an array of websites – including the eBay Marketplace, PayPal, Kijiji, Rent.com and Shopping.com – that bring together millions of buyers and sellers every day.

About Skype Technologies SA

Skype, the Global Internet Communications Company™, allows people everywhere to make free, unlimited, superior quality voice calls via its award-winning innovative peer-to-peer software for Windows, Linux, Mac OS X, and Pocket PC platforms. Skype is available in 27 languages and is the fastest growing voice communications offering worldwide. Since its launch in August 2003, Skype has been downloaded more than 163 million times in 225 countries and territories. Fifty-four million people are registered to use Skype’s free services, with over 3 million simultaneous users on the network at any one time. Skype Technologies SA is headquartered in Luxembourg and is growing its offices in London and Estonia.

Forward-Looking Statements

This announcement contains forward-looking statements regarding Skype and the expected impact of the acquisition of Skype on eBay’s financial results. Those statements involve risks and uncertainties, and actual results could differ materially from those discussed. Factors that could cause or contribute to such differences include, but are not limited to, the timing of the closing of the transaction, the possibility that the transaction may not close, the reaction of the users of Skype’s services, the future growth of Skype’s user base and public acceptance of Internet voice communication services, rapid technological changes in the Internet voice communications sector, the reaction of competitors to the transaction, global developments in the regulation of Internet voice communication services including those provided by Skype, the possibility that integration of Skype’s offerings following the transaction may be more difficult than expected, and the possibility that entry by Skype and eBay into potential new lines of business will not be successful. More information about potential factors which could affect eBay’s business and financial results is included in eBay’s Annual Report on Form 10-K for the year ended December 31, 2004, the company’s Quarterly Reports on Form 10-Q, and current reports on Form 8-K. All forward-looking statements are based on information available to eBay on the date hereof, and eBay assumes no obligation to update such statements.

The eBay announcement:

***A New Way to Communicate***

I’m excited to let you know that eBay plans to acquire Skype, the leader in online voice communications.

Skype has set a new standard in online voice communications with
outstanding sound quality and unmatched ease of use. And like eBay,
Skype has a fast-growing community -- some 54 million Skype users
around the world already use their PCs to talk with one another.

And best of all, conversations between Skype users via PC are free. You
can get up and running on Skype in just a few minutes. Just go to http://www.skype.com/go/x.home to learn more and download the free Skype software application. Try it – it’s fun!

Over time, we intend to make voice communications a part of the eBay
marketplace – a huge step forward in making transactions faster and
easier, as well as bringing even more interactivity and humanity to the
eBay Community.

You can include your Skype ID in your About Me page. For now, however,
Skype links may not appear in View Item pages. We’ll be working with
you, our Community, over the next few weeks to thoughtfully work out
the details of how eBay and Skype will interact, including any policy
changes that may be required.

We expect this acquisition to be finalized soon. In the meantime, you can learn more about our Skype plans in the news release we issued just a few minutes ago.

Working together, eBay, PayPal and Skype will redefine online trade and
community. I hope you’ll join us in this exciting new chapter in eBay’s
history.

Sincerely,

Meg

I have my tickets for VON Boston. Skype Journal will have three of our tribe there. Stuart Henshall (accumulating Tallinn-California-Tallinn-Boston jet lag), Martin Geddes (winding up his North American tour), and myself. Tuesday we're going to most of the keynotes, including Skype's CEO, live, but not in person. There's a blogger dinner Tuesday night. Wednesday is our meet and greet day; we're blocking in 19 minutes here and there to visit with our favorite people. Are you one of our favorite people? One of our rabid fans and stalkers? Would you like to tell us about your Skype strategy? Or asks us for all kinds of inside secrets? Just Skype Patti, our calendar maven, for a time that'll work. We're ducking into the exhibitor lunch on Wednesday so you may see us there or as we actually catch up with people and check out the exhibition on Thursday morning. Flying home Thursday night.

Skype released an update on Wednesday to Skype for Mac OS X.

In this release:

• Chat limit raised to 50 people at the same time
• Drag and drop contacts to add them to chats and calls
• "Events" pane shows missed calls, chats, voice mails. Also shows SkypeOut minutes left.
• Animated emoticons
• Notifications with Growl
• "Do Not Disturb" mode blocks new incoming chats
• Screensaver changes your status to "Away"
• option to show online contacts only, hiding all your other contacts
• return values for Skype API AppleScript interface
• tooltips in contact list
• unread chats count
• use Safari's download folder for incoming file transfers as the default location
• bookmarked chats now sorted alphabetically [this loses chronological information, so may not be an improvement]
• you can now associate up to three e-mail addresses with your account (enter them in the "Edit Profile" window)

Bolded items are Mac-specific.

7.2 MB. Version: 1.3.0.67. Release date: September 10, 2005. No change log, so no specifics on what's changed.

The Ebay rumors are hilarious. Nobody can verify or confirm anything. Not even vague denials from any of the parties. Who benefits from the leak? Skype's VCs pushing valuation buzz and Skype's bizdev team, both to better arm-twist partners.

Everything Skype can offer eBay or its subsidiaries (technology, network access, Skypification of its user experience, PayPal currency conversion of Skype Minutes) can be delivered as a service, without an equity entanglement.

And then you get the Skype Voice announcement. Bill Campbell does a fine job skewering the outrageous charges imposed by Skype. Can you imagine paying 30% of a sale to your credit card company? Or to your phone company for letting you hook up your computer to the phone network? That's Skype's program!

But that's not the worst of that deal. It's that Skype's BizDev team is driving for tactical profit but creating a strategic disadvantage. I'm tempted to say they're trying to think like a mobile service provider but Bill says it looks like simple opportunism.

This deal is an innovation killer.

This type of deal, cherry picking three players out of an entire industry, only reinforces Skype as a "walled garden," a private, tightly controlled place with one master. The other way to do it is to set things up so anyone who wants to compete can do so. Publish protocols and specs and some common tools for call termination (SkypeLite, maybe?) and for commerce. Set rates comparable to what credit card processing companies charge for debit transactions; Skype minutes are risk free since all funds are prepaid cash.

By the way, do you understand what Skype Voice companies do? They are middleware. You call a number. Their computer picks up the phone and answers with a recorded message. It creates a user experience for you using a library of prerecorded messages, a little speech recognition, Voice-XML to guide the conversation, and whatever database of content you're sharing. Like calling up for movie times and making it easy to search for the blockbuster playing near you.

Enormously helpful.

And these companies offer the service now, on regular phone lines, on toll free numbers. They make their money by selling their service to companies that want to engage their customers over the phone. Like banks for bank balances. Or a newspaper for delivery problems. Or a shipper for tracking problems. In none of these examples does money change hands. It's just my business process talking to customers in a convenient, narrow, well structured conversation.

They don't pay the phone company extra for the privilege.

Skype's partnership model doesn't allow this. If there's no revenue, nobody gets paid. And Skype must be paid before they let you pick up when a Skype caller rings you.

Skype's model doesn't allow public service implementations. The volunteers who put together KatrinaHelp would love to implement a service like this but will not charge the dispossessed to find a lost child.

And companies that want to plug in their own IVR systems are shut out too.

Like Bill said, it's a mess.

Instead of putting up a new api, protocols, etc. upon which vendors can innovate and add value the way tellme adds value (terminating calls and doing something with it), they are doing custom deals for a handful of players for short term cash, closing out the developer and entrepreneurial ecosystem including dozens of Tellme rivals.

Skype can fix it but, as it stands, the Skype Voice program is one step back.

Today's announcement on Skype Voice Services is quite exciting.

It puts some real positive spin on Skype being a Global Network; not just an application sitting on my desktop. Opening up Skype Credits will bring a smile to Markus Williamson at Connectotel who proposed something like this (download the pdf) 31 July this year.

The key point of today's announcement:

Chargeable services: callers pay per minute from their Skype Credit. You receive a share of the call revenue.

Skype "minutes" becomes currency, money to trade with.

So is Skype adding to its disruptive power against the RIAA record label owners of the world? Publishers who leave artists poor and broken?

Not with a 30 percent transaction charge for Skype. Then Tellme wants 40 percent.

Such a deal.

Niklas Z seems to want Skype to replace the RIAA Label Owners. At these rates content producers can only choose one new evil over an older one. Hey, Niklas, read Courtney Love Does the Math: "Today I want to talk about piracy and music. What is piracy? Piracy is the act of stealing an artist's work without any intention of paying for it. I'm not talking about Napster-type software. I'm talking about major label recording contracts."

Niklas' message, "We challenge the world’s most creative content providers to work with us and our partners at Tellme, Voxeo and Voxpilot to develop these new and exciting forms of Internet voice services."

The world's most creative content producers get to keep the remainders. Lucky us.

Content producers have been screwed by Hollywood, Book Publishers and RIAA Label Owners. Now we can get screwed by Skype. Content producers need a disruptive technology to unseat this tyranny. The dream we had that our saviour would be Skype and Niklas just got shattered.

I just loved this line in the press release:

"Content providers will join Skype's ecosystem of more than 400 Skype developers worldwide who are already offering hardware and software products to Skype's 53 million members."

What wasn't said was how much money these 'more than 400 Skype' developers have been raking in. No question that some hardware people like RTX are creating good revenue streams, but the majority of the 400 plus developers are into software and haven't made a dime. At least Courtenay Love did better than that with the RIAA Label owners.

Here is another great line:

Skype keeps 30% for promoting your service and connecting callers.

Inside the press release we find out what promotion to 53 million members means: "Content providers' voice services will be reviewed and the most popular will be deployed and listed on the Skype website." This is like telling Courtney Love to make her album a run away hit before we bother recording it and marketing it. At least the RIAA Label owners committed hard cash to bribe opps market the recording as it went to market.

Creating Skype Minutes as money is a brilliant move by Skype. It has the possiblities of helping Software developers monetize their efforts and of course creates a whole new set of opportunities for content producers. Especially when Skype Video ships. But I can't say anything good about the economic model Skype and Tellme propose. It is a mess.

TOM Online faces severe competitive and regulatory problems in China per reports compiled by Jirong Zhou. Jirong posted to his Zalbazone blog that TOM Online is not only far last in a three-way race for the Chinese IM market, but that major telecom operators are defending their own VoIP strategies (vaporware?) by blocking Skype.com and SkypeOut in major Chinese cities.

This is another example of telco incumbents aggressively defending their turf. Could Skype have picked a better partner, one with stronger guanxi, one better able to negotiate access to China's major markets and forge more alliances with China's regulators and incumbents? Right now they're walking away from SkypeOut revenue. How long until Chinese users get the same service as Skype users everywhere else?

The full article, including screenshots of the blockage and quotes from Tom.com CEO Wang Leilei follow...

From this post.

Cold Water

For Tom.com, third largest Portal in China
For Skype, world's largest VOIP player
For Tom Skype, their Joint Venture.

Just 3 days after Skype and TOM Online announced an exclusive joint venture (51% TOM Online, 49% Skype), there appeared a negative news on Sina's homepage, China's largest Portal. Telecom Operators are going to block Skype in ShenZheng, Shanghai, Beijing, GuangZhou. Red circled in the up picture.

I found the picture in Tom's Skype forum showing he is unable to login SkypeNet. A journalist from First Financial Daily reported his experience by calling China Telecom Shenzhen branches' 10000 service number. They said:

We detected that he used SkypeOut which is illegal to use. His number is in the black list. He must Guarantee not to use it any more. Or he will get the FINE.

Tom failed to land SkypeOut in June. And the Information Industry Department files that it is illegal to operate VOIP except the 6 Operators in China.

Within one year, TomSkype successfully get a 3.4M user group. It's an amazing rapid speed, however it still looks too slow, compared to Tencent's hundreds of Millions user group. Wang Leilei, Tom.com CEO, said,

"It's impossible to be profitable even if the 3.4M users are all using SkypeOut. So we are not going to seek opportunities to land Skypeout in the near future. The joint company is going to enrich user experiences with TomSkype."

Virtual Operators

Though it's illegal to offer VOIP Service, there are many operators making deals under the surface. Up to now only 263 got a pc to pc VOIP operating license.

Phone to Phone and PC to Phone are settled as basic Telecom service, only the 6 Operators has the legal identity to offer service. All other parties are designated as Virtual Operators. What's their fate?

[Posted by Jirong Zhou 2005-09-08 19:36:22. Mr. Zhou is business development and marketing director for Skype developer The Masters Team, maker of PowerGramo (coming into beta soon).]

Is Sony about to ship new Vaio's with Skype installed? This link to Sonystyle in Japan (which is apparently a separate company) suggests Skype has completed a local marketing deal.

However, my contact in Japan Asao Ishizuka contacted both Sony and Sonystyle and it appears that all Sony's Japanese Autumn models (Except Type A - Global?)) will ship with Skype preloaded. That's a big deal for Skype. From Sony's perspective as they preload many applications an announcement may not be forthcoming. For Skype this would represent an important breakthrough. We will continue trying to run down the facts.

Mark Evans writes a nice summary on Skype latest investment rumors which suggests Hutchinson Whampoa will take a 5% stake for a billion. (Update: Sorry folks - this was sloppy writing as pointed out in comments - suggested valuation a billion therefore.)

We can read between the lines and see real pressure on Skype to take another round and accelerate development. While 5% won't wrestle ownership control the VC's may gain some voting rights that enable control over who runs Skype in the future.

See also: Rodrigo and Andy

Skype announced Call Forwarding and added it to their latest Windows beta 1.4. I've been experimenting with it. It doesn't take long to try out, there aren't that many features to it. Compared to iSkoot and Jyve, Skype's call forwarding has two quasi benefits. 1) it works when your Skype is offline, and 2) it lets your buddies know when offline with a presence icon that you are in call forward mode.

Note the additional icons. The blue call-forwarding icon and the green this-is-an-incoming-forwarded-call. Note: you don't know who the forwarded call was from (a potential problem). Similarly, callers who find their calls forwarded don't know who might answer. The ring tone remains the same, there is no audio signal that something is different. In this example I forwarded skypejournal to ring my Skype ID.

Skype Call Forwarding

• Is available to all Skypers using the beta 1.4
• forwards inbound Skype calls (from Skypers or on SkypeIn) to any other buddy account or phone number. When forwarded to landline or mobile it will cost you SkypeOut minutes. In some countries know what your rates are!
• works even if you don't have a SkypeOut account. You can forward an inbound call to another Skype buddy or account.
• will automatically forward calls not answered after four rings even when skype remains active. If you send it to a cellphone which answers it will take the voice mail. If the forwarded call doesn't answer then it will revert to your Skype voice mail if you have it.
• may forward and ring up to three numbers. Additional numbers don't appear to be rung sequentially, rather all at the same time.

Things you can't do on call forwarding.

• forwarded calls won't go to your skype friend's voice mail.
• similarly a forwarded call cannot be forwarded on by the buddy you have forwarded it to.
• voice messages also aren't forwarded which makes sense as they aren't meant for you buddy.
• no control over what names you can forward. This should be done by contract groups.
• no control over SkypeIn and forwarding.
• there is no notification via text to another Skyper that their call is being forwarded.

Are there still issues. You bet.

• For a Skyper the person that they are calling remains visible. It is easy to miss that the person they are calling to is a call forward. Example the caller places a call to an offline account (eg from a directory search), the call is forwarded to another Skype buddy at no charge. The buddy who answers gets a minor blue forward signal on the picture. The identity of who the caller is forwarding to is preserved. There are pluses and minuses to this strategy.
• I'd like to be able to turn call forwarding on and off from my SkypeIn number. I'd also like to be able to get voice messages by dialing in to my SkypeIn account.
• I may not want to give out my phone or cell number. So setting call forwarding and not releasing that info is appropriate. However, the caller may need to know it is being forwarded. It may not be explicit enough.
• leaves open the opportunity for abuse. I open a junk alias and add in three buddy names I want to harass. If the name is attractive (even left on in Skype Me mode) they could be in for a rude set of calls. The result could force me to increase my privacy settings.

Some things Skypers will start experimenting with.

Call Forward and the Small Office: Open a Skype account with your company name. Buy a SkypeIn number or even multiple numbers. Then forward to three Skypers (you can see a work groups account coming here can't you!) Any one of the four can answer the calls. For some companies you could forward multiple Skype International numbers to your PBX number. If you are in one of Skype's 30 flat rate countries this could be interesting.

Global Calls to Mobile: Even if your wife doesn't use Skype you can set up an account for her and forward calls to her mobile from whereever you are in the world for almost nothing. She doesn't even have to know how you did it.

Aliases: Set up aliases and then set them to call forward. Your identity is masked on inbound calls while the other person's is visible to you (which could be an alias too). The only thing missing is the presence data for your alias. Still with tags when SkypeWeb launches this possibility will be close.

Test...

Ring my SkypeIn number that is forwarded to another Skype account that doesn't have voice mail or anything. Let it ring. It finally does go back to my Skype account voice mail. It did take a lot of rings. I'd note too that the original inbound number said "Vonage" and then on the call forward it provided an accurate caller ID phone number.

1.4 Windows Beta released.

Bunch of cool new features including:

• Free Call Forwarding
• Expressive content
• Improved Search
• Application to Application Messaging
• New API improvements
  • Application to Application Messaging
  • Skype Window Control
• Skype URI links (skype://) for email and web pages

Get it on the Skype for Windows download page.

Cautions: We've had some difficulty with promptness of presence. What do you think about the new features? The look and feel changes?

Change notes...

31.08.2005 version 1.4.0.45

• Feature: 21 new emoticons
• Feature: My Pictures: possibility to choose pictures from Expressive Content
• Feature: RingToneManager for Expressive Content of audio files
• Feature: API notifications for contactlist selection and focus
• Feature: Call forwarding
• Feature: Contextual tool tips
• Feature: Multilingual EULA
• Feature: Possibility to disable file transfer

• Change: Improved Search and AddFriend functions
• Change: Getting Started Wizard: new layout
• Change: Profile: month names are translatable
• Change: Import Contacts: new layout and process improvements
• Change: Improved Emoticons
• Change: API: Allow sending voicemail to myself
• Change: Skype client can now be maximized
• Change: New Korean translation

• Bugfix: Some optimizations during call initialization, should be a little more responsive now
• Bugfix: Import Contacts: mass authorization is back
• Bugfix: Skype does not start for some users
• Bugfix: API: support expressive content files SET RINGTONE and AVATAR
• Bugfix: API: enchance GET RINGTONE to report status
• Bugfix: Prepopulate Skype Test Call Service on new user's Contact List

Thanks to all who came to Palo Alto to celebrate Skype's second birthday with us. Great people, good food, and a lovely time.

Where will Skype be a year from now?

Will there be a liquidity event by this time next year?

How will the management roster change?

Who else will join the fray?

How many people will be calling with video?

Which customer segments will Skype dominate or abandon?

How many hardware products focusing on Skype will exhibit at CES?

Last Tuesday we were all waiting for Google Talk. By Wednesday we had Google Talk, MSN Messenger's 7.5 with video and quality talk, Skype opening up SkypeNet and SkypeWeb.

Something's breaking through. "Something wonderful."

Let's talk about it over spicy noodles at Jing Jing. Come one, come all. Bring friends and spread the word.

Join the bloggers of Skype Journal: Phil Wolff, Stuart Henshall, and Bill Campbell in town from Canada. Bring $25 and we'll eat family style. See you Tuesday at 7 in Palo Alto.

Please RSVP on Evite or leave a comment so we have a headcount.

Is it all over for Skype? As Google Talk launched tonight with an Orkuttian viral shove provided by Gmail. At first glance it could be Skype's worst nightmare or the kick start necessary to refocus Skype. If you missed the buzz, Google Talk is the long awaited and predicted IM / Voice client. It won't be over for a while and the battle will take to the trenches with Yahoo, MSN and AOL battling to the end. This is a first salvo. Don't expect Google's feature set additions to follow Skype's path immediately to Telecom as Google has other opportunities sitting there within its empire. These are my first impressions.

• Extreme Simplicity. If you have a Gmail account you can just log in. The client is very simple.
  
• Find buddies quickly. If they are in Gmail then you can make hundreds of invites very quickly. Authorization is simple.
  
• Presence. Simplified and more intelligent than ever with customized field options that add new fun to presence. It's about time!
  
• Chat. Very basic, no emoticons etc. Still it's clean and archived and I bet searchable (if not now soon) by google desktop. Chat uses XMPP and thus iChat and Jabber clients can connect directly to Google Talk. You can also add it immediately to Trillian. (Trillian could be quite a winner). Guess that will put Google Talk presence on mobiles too!
  
• Talk. Talk is chat centric. Ie click to chat rather than Skype's click to call. Clicking opens a chat dialogue box. You then initiate a call from the chat window. Talk quality matches Skype and is better than Yahoo.
  
• Chat Window Organization. Windows self organize in an interesting fashion until closed.
  
• No profiles and no friendly pictures at this time.

How it really worked.

I had 8 conversations all around the world. Some of the voice connections didn't connect immediately and felt like they failed. There was just no sound. Sometimes the sound started after the call was connected for 30 seconds or more. This is likely just a short term bug. I enjoyed the inbound ring tone. Distinctively different from Skype. The invite process was very simple, building my list very elegant.

What's Missing?

From a Skype user's point of view: Almost everything. There are no profiles, no photos / pictures, no voice mail, no multi-conference or multi-chat. Plus there is no SkypeIn or SkypeOut capabilities. This is not a phone replacement. The multi-chat and conference calling should be easy to duplicate. The telephone system more difficut. However, each name is a SIP name and that is designed to connect with Vling and Gizmo project in a very short time. Plus with rumors around Google raising money, a TMobile USA purchase can't be that far away. That would provide a user base, the WiFi hotspots and most importantly the chance to integrate mobile numbers with VoIP.

Where's the Strength?

Talk is already integrated with Gmail and thus links nicely with IG, Google's personal content portal. So when will GoogleTalk have access to Orkut (profiles / social networking - pictures and profiles) Blogger (another place to share presence), Desktop (archive searching), Maps (location information) and instantly the whole Jabber/XMPP community. How quickly can Google bring these all together. Then they already have a photosharing program etc. Google has all the elements to bulk up to a Yahoo like client very quickly. Add in Ad Sense etc. Very neat models are likely to emerge. I heard from one punter tonight they had told their mother to buy more Google shares.

Developer Talk

Google has a great page outlining their preliminary plans and open strategy for the future of "talk."

Google's mission is to make the world's information universally accessible and useful. Google Talk, which enables users to instantly communicate with friends, family, and colleagues via voice calls and instant messaging, reflects our belief that communications should be accessible and useful as well. We're committed to open communications standards, and want to offer Google Talk users and users of other service providers alike the flexibility to choose which clients, service providers, and platforms they use for their communication needs.
Google

How does Skype stack up? Yahoo?

• Google may win on philosopjy alone (see above mission) or the resources in dolars and manpower. However today, while Google may get it's Orkuttian swell of new users isn't actually an acceptable replacement client for either Skype or Yahoo. Both do more better for their current audiences.
• On features, Skype is still ahead and if they would speed up their development and releases of call forwarding, VM improvements, Video, and their Presence Server they still have a chance althougth the market has shifted dramatically. Yahoo is bulking up however still does nothing really well. That may change.

Where should Skype's strategy start?

Open Up! By contrast with Google, Skype is on a philosophical back foot, well balanced. Being closed is no longer an asset, so Skype can compete only on its design, features and capabilities. To open up, the Skype chat client must adopt the Jabber/XMPP protocol, accelerating its interconnect and encouraging developers to "stick" / "start" developing products around the API. So far Google hasn't announced an API (count the hours). They will need one even if just for hardware. Skype will be forced to open up many aspects of its interface now.

The rumor of Google Talk appears to be rattling the cage at Skype and will shake some egos. This post reflects on Skype's latest PR release which opens the gates on new initiatives. Are they in response to Google Talk? I wrote this prior to testing out Google Talk this evening. I'll let you be the judge.

Party time at Skype over the next week.

...is preparing to mark its second anniversary next week by opening up its platform to anyone who wants to integrate Skype's presence and instant messaging services into their website or application. By opening up Skypes platform to the web, it will now be simple for anyone to connect to Skypes fast growing member base,.... Skype Anniversary Press Release

Underlying the fluff we find two new initiatives that indicate Skype is testing a bolder (or maybe reckless if the news is too premature) strategic direction. Certainly these components support Lenn Pryor's desire to build a broader ecosystem around Skype.

SkypeWeb: Creating a web of availability.

Skype will launch a web presence server solution under the name SkypeWeb. This will be supported in a new client release (we don't know when) which will broadcast your presence data via preferences in the client. Apparently a new bit of code in the P2P network will ping status updates every five second to a presence server. Presence information will be availabie in the form of an ATOM feed which will enable presence updates and also enable contact lists. All list detail is said to be controlled by the user. Thus the Atom feed will push presence data direct from the Skype client enabling contact lists for a circle of friends. The general idea space is good. Details? Client? We don't know yet.

SkypeNet: Stripped down client extends Developer opportunities:

Skype will open up presence and IM functionality to the whole world under the name SkypeNet. It's unknown whether this will include file sharing. SkypeNet is made up of SkypeLite clients --- a headless Skype client, without user interface, that can be integrated into any application. This should let you build Skype servers and web services. It should help Skype become enabled in programs like Trillian, make Skype more interesting for online game publishers, and create opportunities for business applications that need to scale. This is a huge gap in their architecture and, depending on execution, SkypeNet may fill it.

Some of the PR announcement is fluff. Skype has done a tremendous job of building and growing a software platform. Still, the combination of big deal buyers (Murdoch billions) and bragging on registered names (51 million) doesn't sit well with me. It hides the plain truths. Skype at two is still an upstart minnow. It's achieved much. Year One saw the launch of P2P telephony that just worked and free conference caling. Together these reinvented telephony. In Year Two we have SkypeOut, SkypeIn and the SkypeAPI and Skypers who want to do more with Skype. Today Skype has a global following in the 10's of millions talking for billions of minutes.

The industry clearly needs some metrics. However apples and oranges examples isn't the way to do it.

Skype's minutes served are currently flat. Active users are stalled. Releases with substantial features - voice recording, - call forwarding, work groups, contact lists, all seem to be coming along very slowly.

What is slow? From a developer's perspective progress may be very fast. However, from a Skype user point of view, many are now using Skype as a super telephone replacement, often for mobiles, so we expect all sorts of complex new features to be available. They are standard features on other systems. Now Skype adds these two initiatives. Expectations for Skype's next major client release are growing. We want it all and yet, two years after Skype first launched, I still can't do the things with it I dreamed I would like to be able to do.

So, Skype, please don't put your credibiltiy on the line with stretch announcements. The meme is still spreading because Skype is inherently good when I can talk to one or more for free. However, nothing kills a meme faster than the smell of desparation or an empty store. Telling me about presence servers and stripped clients is not the same as delivering them to me. The developer community has provided many gifts. I just hope when you blow out the two candles this week our wishes come true.

Full Text of a Skype news release today.

SKYPE OPENS ITS PLATFORM TO THE WEB

Skype Creates the Largest Open IM and Presence Networks Worldwide

(Luxembourg 24 August 2005) - Skype, the pioneering Global Internet Communications Company, which offers free high-quality phone calls to anyone with an Internet connection, is preparing to mark its second anniversary next week by opening up its platform to anyone who wants to integrate Skype’s presence and instant messaging services into their website or application. By opening up Skype’s platform to the web, it will now be simple for anyone to connect to Skype’s fast growing member base, which has already passed more than 51 million people in just 2 years.

Now anyone will be able to benefit from Skype’s platform and will be able to integrate both presence and instant messaging features into websites and applications such as online gaming, e-commerce, communications and productivity tools, instantly building community and connections between people who can chat and alert others to their online availability. By opening up its platform to the web, Skype will instantly be creating the largest open instant messaging platform in the world.

“In two short years, Skype has pioneered a revolution in global Internet communications by making it simple for anyone with an Internet connection to make and receive superior quality phone calls for free,” said Niklas Zennström, Skype CEO and co-founder. “People love to talk, and voice is fast becoming the key category for global Internet communications. Skype’s mission is to make communicating through the Internet natural and easy to do, so in addition to voice communications we offer the power of both instant messaging and presence, which have become as ubiquitous as email over the last five years. As we enter our third year in business and as the only company totally focused on global Internet communications, we think now is a perfect time to make these popular features available to anyone who wants build community and communications into their website or applications.”

Skype’s Anniversary Milestones

In just two years, Skype’s highly disruptive and award-winning software for making free high quality phone calls through the Internet has seen:

• over 150 million downloads in 225 countries and territories
• over 51 million people registered to use Skype’s free services
• over 3 million people using the service concurrently
• over 12 billion minutes served (equating to over 45% of all US VoIP traffic – Sandvine, August 2005)
• over 2 million people created accounts for Skype’s paid services

Skype's level of growth in both free (51 million) and paid services (2 million) already eclipses the growth of today’s Internet giants. After two years Skype is already twice the relative size of Yahoo! (26 million registered) and over six size times the relative size of AOL (303k paying subscribers).

To support its growth and in recognition of the size of the global Internet communications opportunity, Skype has invested significantly in building out its local presence worldwide to serve the needs of its global member base. Skype is already offered in 27 languages and www.skype.com can be read in more than 22 local versions and languages. Skype also has representation and major partnerships in over 15 countries, including USA, China, Japan, UK, Germany, France, Sweden, Brazil, South Korea, Spain, Estonia, Poland and Taiwan.

SkypeNet and SkypeWeb APIs

Skype is now extending its investment to the rest of the Web, by opening up of the SkypeNet and SkypeWeb Application Programming Interface (API) as part of the Skype Developer Program, which already supports a thriving community of partners and developers working with Skype to help build the next generation of services taking advantage of Skype’s revolutionary software For more information about Skype’s expanding developer network and how to work with Skype, please see: http://share.skype.com/share/developer_blog/.

“Skype’s continuing innovation is leading the revolution of internet communications, and opening up the Skype Net and Skype Web API to the web is a major step. Skype is benefiting partners who will recognize the value of being able to leverage Skype’s platform and connect to their rapidly-growing user base,” said Jeff Pulver, CEO of Pulver.com Enterprises.

About Skype Technologies S.A.:
Skype, the Global Internet Communications Company™, allows people everywhere to make free, unlimited, superior quality voice calls via its award-winning innovative software for Windows, Linux, Mac OS X, and Pocket PC platforms. Skype is available in 27 languages and is the fastest growing voice communications offering worldwide. Since its launch in August 2003, Skype has been downloaded more than 150 million times. Skype Technologies S.A. is headquartered in Luxembourg and is growing its offices in London and Tallinn. Skype Technologies is privately held and backed by top tier international venture capital firms, including Bessemer Venture Partners, Draper Fisher Jurvetson, Index Ventures, and Mangrove Capital Partners. www.skype.com

###

The recently launched DNA, a national English-language newspaper, has bagged the first interview with Niklas Zennstrom in Indian media. No surprises really, as he talks about how Skype has taken off, the thinking behind creating Skype and the way forward for Skype. Partnerships with handset manufacturers, and wifi enabled devices, neww payment options, and additional premium offerings such as video-conferencing and workgroups focussed offerings.

A non-committal 'perhaps' to the question of whether India could aid in product development going forward, and the statement that India ranks 36 in Skype's top ranking countries of use, with more than 279,000 users. Ending the interview with this thought :

"As one of the world's emerging leaders in IT and associated services, India certainly has a major part to play in the future development of Skype."

279,000 is a small number really, I think there is tremendous potential to expand the base in India. Perhaps a starting point would be to scope the opportunity with different segments of potential Skypers in India - the Indian with family abroad, the villager with low communication access otherwise, the internet kiosk user, the small and medium businessman.

Then there is the business model ... free vs paid services – should Skype look at 100mn subscribers to free service or 10mn who pay? What are the critical success factors, brand strategy, media streams etc both short term and longer term ?

And to scope different areas of operation and affiliates - appropriate partners, hotspots, cybercafes where often there is a lot of VOIP usage, social networking sites (dating and match-making sites for instance are huge in India – not sure they currently use VOIP or presence), the whole BPO industry, portals and programmers who tend to use more of these technologies (and are a huge number).

I couldn't find the article online so here's a scanned image of the interview.

Google to raise billions for a buying spree. Reports keep mentioning Skype Technologies as a potential acquisition target. Rumors. Wouldn't hard news be nice for a change?

Hmmmm.... Five million new registered users in the last three months? No big deal. In fact if I was running Skype I'd be concerned if I didn't know already that the registered user number is grossly overstated. In gross terms this is the way the IM industry appears to count. Even then I'm not sure the players count apples and apples. For example in Yahoo you can have more than one alias on one account. How many registered users is that? In Skype each name is counted as a different user. In real terms like the downloads it's just another fiction. Here's why.

When we look at the last three months we see approximately five million new registered users. Cool, they just broke 50 million. Growth has apparently slowed. Skype added only 10% in the last three months. So what is this five million number comprised of. What does it mean?

1. Legitimate New Users. These people are new to Skype have never registered before and are just getting started. A percent will download and forget it after the first few experiments. I have no figures on abandonment. What would it be? How many percent over the first six months? 10% or 50%? Perhaps 10% even before they make a calI and 15% before the second call. (Part of the no buddies connundrum and no free minutes). So the conversion loss could be quite high. Users install to satisfy a friend or family member. Others add it and then don't get enough of their social network across. It's a hard life for a new user. Skype knows this and has added all sorts of features to help. Import contacts, toolbars etc. The more contacts / buddies a person has the more power the application provides.

2. Aliasing: Many users want more than one name. Each registration counts as a new one. The fact is for the most part users aren't running these as multiple lines on multiple computers. They log in and off. They may use one for SkypeMe and another for more legitimate business. I've lost count of how many names I've registered. I'm not alone. Most of those names are idle. I'd think most new users will over time end up with at least two names.

3. Name churn. My daughter churns her AOL name quite often as do many of her friends. It's a way of cleansing their buddylist. The more youthful Skype's appeal, the greater the likelihood that "churn" has an impact. While I doubt 1 in 10 users churned their name in the last three months, given the base (45 million) churn could now have a significant impact on the growth of new registered names. Thus the larger the Skype user base, the more churn in new registrations we get.

Now there is another way to look at the 5 million new registrations. If we saw five million new users then at a minimum we would say we had added 10%. If all else remains equal then we would expect the number of active users online to have increased similarly. At the end of May the daily peak for active users concurrently online was consistently through the 3 million mark and I think reached approx 3.25 million. Since then, growth of active users online appears is static (at best). That means the number of new registration is significantly lower. Alternatively, many abandoned Skype in the period.

Separately, don't underestimate the impact of summer, college kids at home, perhaps less access to broadband. Skype surged last September and I'd expect it to surge again this September. Plus some Skypers share an account. So that's one registered account but two Skypers. A number Skype has been releasing that does matter is the number of SkypeOut users (round to 2 million). A good portion of those are using it daily. Separately Skype has quoted that 30% of Skypers use it for business. So they are online all the time too.

In the end it's all guesswork.

Conclusions:

1. Nowhere near 5 million new Skype users have been added in the last three months.
   
2. The registered user number does not represent with any degree of accuracy actual Skype user numbers. It is more materially wrong than right.
   
3. Many factors account for the difference, behavior, peer groups, legitimacy, size of buddylist, SkypeOut,early experiences, etc.
   
4. My number on unique Skype users last seven days would be 12.5 million tops. I'm happy for Skype or you to prove me wrong.

Finally the only numbers that matter is the number of users that have conversations and exchanges each day. Be nice to know how many actually held calls and how long those calls lasted for. The health of the community is in the numbers. The 50 million may make it seem like Skype is the gorilla. In fact Skype is still an ant and the definite underdog. People like underdogs. Perhaps Skype will come clean and report more representative numbers. Unless of course they are trying to sell.

"Today we passed 150 million downloads, and a few days back, 50 million registered Skype Names."

Jaanus on the Share Skype blog, 17 August 2005

The number of people with more than one Skype name is neglible. So we have confidence that Skype has added 5 million users (about a ten percent growth) since 11 June 2005). This is about half of Skype's earlier adoption rate. Can we chalk this up to the summer holidays (north of the equator)? Or has Skype started to reach a natural market size?

By Karim Pedersen, ComON. Translated for Skype Journal by Torben Nyhuus, Aalborg, Denmark.

The Padborg (a Danish border town to Germany) company Dangaard Telecom has made a partnership agreement with Skype. The agreement means that Dangaard Telecom may distribute Skype related products like headsets and wireless phones in Europe, Middle East and Africa (EMEA).

Dangaard Telecom is Europe's largest distributor of mobile/cellular phones and the agreement opens the possibillity that Skype’s software can be integrated into smart phones.

Furthermore Dangaard Telecom and Skype will start a push/campaign to sell the ip-telephony products on the net.

Dangaard Telecom employs 1400 people in 16 countries. $1.5 B US in revenues. Dangaard Telecom focuses on distribution and Logistics.

For Skype this means more marketing clout in Europe, the Middle East and Africa. For Skype users, better access to peripherals and support. Also watch for Dangaard to intoduce mobility products.

Skype is on the move, building relationships with portals around the globe and now with distributors.

The Lexin Swedish-English dictionary defines lagom as "enough, sufficient, adequate, just right."

Lagom is also widely translated as "in moderation," "in balance," "optimal," "reasonable," and "average." But whereas words like "sufficient" and "average" suggest some degree of abstinence, scarcity, or failure, lagom decidedly carries the connotation of perfection. The archetypical Swedish proverb "Lagom är bäst," literally "Lagom is best," is translated as "Enough is as good as a feast" in the Lexin dictionary.

Windows update today: version 1.3.0.60. It's a bug fix: "call quality is improved for users with restrictive firewalls and routers."

Mac users, the latest version is Mac OS X, Version: 1.0.0.24. Release date: April 12, 2005.

A Mac Beta version is available for the adventurous. 1.0.0.49. Release date: July 27, 2005. This is a major update, adding multichat, the Skype API and a slew of bug fixes.

Linux users were updated last week, minor. Version: 1.2.0.11. Release date: July 28, 2005.

Skype $3 billion dollar sellout? Is there a real story here? Robert X. Cringely adds to the rumor mill by reporting that Skype was almost sold last week for $3 billion to Rupert Murdoch who just bought MySpace for an extraordinary sum. Was that the reason for Tim's exuberant chatter at AlwaysOn?

Some facts and figures in this piece are clearly wrong to Skype watchers. Some numbers, e.g. the value of the "customers," suggest a possible valuation method. I do agree with part of his conclusion that Skype should partner with an independent mobile carrier. (T-Mobile? in the US) Still his assumption: no IPO in Skype's future; with a buyout nearly certain. The creative speculation appears shrewd and informed. So the questions?

• Is Skype worth $3 billion? 30 billion?
• Does Skype's M&A rumors affect partner plans and willingness to commit?
• Which buyers are more acceptable to Skypers? To Skype's business ecosystem?
• The money from an acquisition goes to the current owners (founders, some employees, investors). If you buy Skype for billions, how much more money would you want to invest and where would you put your money? If you and raised billions where would you spend the cash you raised?

What do you think? Can you substantiate? Read his blog Skyped.

Google is a perfect example of this latter effect, entering the market years after Alta Vista and Excite. And the Google of VoIP looks like it might be Skype, which was almost sold last week to Rupert Murdoch's News Corp. for $3 billion. PBS | I, Cringely . July 28, 2005 - Skyped

Others that are talking Skype sell stories...
Om Malik
Newswireless
Mark Evans
Loic on Murdoch
Andrew Hansen
Jim Courtney: A Skype Investment Primer
Robert Scoble
Carlos N Velez: "Let's start a new rumor... Google is in serious merger discussions with Skype. The new company, to be called GooSky...."
Carlo at TechDirt
Jeremy Wagstaff: "I suppose we should steel ourselves for the possibility that it doesn't last, at least in its present format."
Michael Parekh: It's all Rope-a-dope
OnoTech: "Wrong, wrong, wrong"

Now anyone can make free international calls using SkypeOut even if they don't have SkypeOut as an added value service!

Free SkypeOut was announced by Jaanus Kase an hour ago in the Share Skype blog.

This is for calling typically toll free numbers such as 800, 866, 888. My Skype reporter in Gdansk, Poland, Tomasz Tybulewicz, and I tested out this service by calling +48800656666 a toll free Polish phone number. The sound quality was excellent; the price was right on: FREE.

Tomasz has one question for you to ponder, "Is this a beta test before the introduction of emergency numbers like 911?"

That's a good question Tomasz!

"Since July, the 27th Skype Global Rate will also cover Poland, China, Greece, Taiwan, Hong-Kong and Switzerland. Other prices are also being lowered, although not to the SkypeOut Global Rate, in the Czech Republic (mobiles), Bulgaria, Slovakia, Croatia and Finland."

"27th July is the first anniversary of SkypeOut. This is a reason to lower the price to 0.017 Euro per minute."

This is my rough translation of news from Dziennik Internautów, Internauts Daily, reported to Skype Journal by Tomasz Tybulewicz, Gdansk, Poland: "Since tomorrow evening SkypeOut users will be able to make cheaper calls to Poland. Poland will be covered by SkypeOut global rate at last. Prices to Polish mobiles also will be a little lowered."

by John Sjolund, Cape Town South Africa

Having been a very early user of Skype I have tirelessly crusaded to get my friends onboard to what I consider a telecommunications revolution. Having grown up in two countries, having two brothers in two continents Skype has needless to say been great for me. However, getting friends to switch from other instant messaging programs has been difficult and at times frustrating. This has now changed.

Since moving to Cape Town, South Africa from my native country of Sweden Skype has taken a new leap in my life. From being a high quality messaging program it has now developed into my exclusive communication tool for friends and family at home, more than 7000 km away. Equipped with the Olympia Dualphone and a SkypeIn number in Sweden, when I am home in Cape Town, it feels like being in Stockholm (a bit warmer winters aside). It is seldom I become lyrical about a new tech product, but this combination is incredible. With the Olympia Dualphone hooked to the USB port of my computer, friends and family call a local telephone number in Stockholm via SkypeIn, and it rings on my cordless phone down here like any normal phone. I am no longer bound to run to my pc, put on my headset, and sit stationary at my computer. I have a normal phone that works perfectly with Skype, SkypeIn and SkypeOut. I can easily keep in touch with friends at home, and it costs almost nothing. Imagine, working in Africa and having daily contact with my friends at home for almost no cost. By the way, it works as a normal cordless phone with normal landlines as well.

This combination just works, simple as that. It’s so seldom you buy a new gadget and it outperforms your expectations. It happened this time for me!

I choose the Olympia Dualphone ahead of other similar products because of its competitive price, its ability to work in different countries, and the fact that the company seems to regularly update the firmware. The phone has a good solid feel and is easy to use. The interface, though not perfect (doesn’t sort online/offline contacts well) is easy to navigate and built logically. Within about 15 minutes from opening the box of my new phone I had it synced with my Skype Contacts, and ready to go. Sound quality is great. Being that the phone DECT standard, it has the ability to transfer calls between headsets, I have yet to try this feature however.

The Good
• Simple to use
• Phone conveniently peeps when contacts come online
• Caller ID on SkypIN works perfectly
• Quick menu system
• DECT standard
• Upgradable
• Comes with many telephone adapters to match most countries outlets.

The Bad:
• Currently not available in North America
• Boring ringtones

Summary: The combination of this phone and Skype really is incredible. I highly recommend it!!!

From China Tech News:

China's Ministry of Information Industry (MII) reiterated that it still has not formulated guidelines concerning VoIP businesses and that many current VoIP businesses could potentially be illegal.

Companies like Netease (NTES), Tom Online (TOMO), Skype, and Tencent have all started VoIP services in China. And the 263 Group and HL95 have also recently entered the sector.

The VoIP sector offers great financial rewards for companies because voice communications on the network can be as much as ten times cheaper than traditional fixed-line phones.

MII says that it is still testing VoIP and forbids illegal "phone cafes" from opening in China. It also offered no clear date on when it will issue guidelines for businesses to operate legally.

I'm at Always-On Tim Draper and Niklas are beaming in via Skype's new video client. This is the first public demonstration. The interviewers are Bambi Francisco MarketWatch and Tony Perkins of AlwaysOn. Tim and Niklas are in Estonia. The talk content has not been memorable. Surprisingly the commentators never asked one question about the SkypeVideo delivery how it worked or when the launch date is. So how good is Skype video? It's very very good! (I expect that the "connection and bandwidth had no limitations and was well tested).

Skype Video:

What did we learn about the Skype Video? What can we now tell you? What will it be called? I like the idea of SkypeSee. This looks like another killer app that will add a new dimension to communication and behavior.

1. New Functionality: Skype's version will bring new functionality to using video cams on PC's. When you make a SkypeSee call and it rings at the other end the video connects as you answer the call. Within seconds what was once a photo of me smiling is now a live video picture. Thus no need to open a video window or wait for it to connect. Calls in the default mode don't need to wait to escalate to video. It's there straight away. That's likely to be revolutionary from a behavior perspective. (You can bet that the auto video answer etc. can be turned off or limited.) This makes the video integration seamless. It will also open up new opportunities for sharing presence to buddies at certain times.

2. Intimacy Gradient: Video is not restricted to being viewed inside the Skype call window. Tony and Bambi opened a large window that effectively filled the screen. Thus there is a secondary mode that enables you to focus on a very personal exchange where video and voice will dominate your desktop and immerse you more intimately in the conversation. The intimacy factor is helped because in this demo the lip synch was almost perfect. It was close to TV quality on the screen. That will be good enough to change perceptions of the product.

3. Benchmarks: The comparison that you should make on Skype's video setup is with phone approaches like Packet8's where phone to phone video is active. Thus that solution is simply brought to the desktop. The behavior that it creates will help the hardware market as well. I don't have a Packet8 phone to compare the quality. I'd expect it to be comparable and yet in the full SkypeSee screen mode you of course get a much larger picture. The investment to go to SkypeVideo is less than adopting Packet8 across two households. Thus Skype is opening up a new "integrated" handset for broadband customers. I just wonder when Comcast will provide a Skype phone like the Boingo Wi-Fi deal equivalent.

4.Release Date: It's not clear how long or when SkypeSee will be released. When Skype? When can we officially have a beta test version?

Now the whole expereince of using Skype Video as a conference exchange is pretty new. It's worth looking at how it stacked up. we can't ask the participants, however we can learn from the audience. Upfront at AlwaysOn are two screens. One contains the back chat channel and the other has Niklas and Tim's video picture.

Learning from a Video Conference to large audience

This exchange lasted an hour in front of a video camera. Niklas and Tim sat side by side. It looked good to us. I doubt it looked good to them. For in their case they had Bambi and Tony on their video cam, they didn't have the audience. So it was clear that Tim in particular became increasingly disconnected with the audience. Without visual feedback or apparent access to the chat channel he missed the "audience" turning on his arrogant and offhand statements. The learning is you must set up and use the technology so you can see the audience at the same time. Skype worked on the setup, they should have enabled additional cam's so they had some sense of the space.

Second when you have a product that is reasonably well known and uses new technology you should demand that the interviewers have really used it. Bambi's questions shed no light on Skype and where it is going. The questions weren't new. I would have loved to have done this interview. There are few questions that Bambi or Tony asked that I would have pursued. Unfortunately, to learn new things you really have to get interviewers that follow these topics. There were good stories that could have emerged.

Important content?

Plenty of quotes. Nothing really new. The summary at the end by Tony was "Tim is over the top!". That summed it up for me. Skype has no need to be arrogant and unfortunately that was my takeaway. A review of the chat session would prove I was not alone.

Refreshing change from Skype. A new blog for the Developer Zone.

Current topics are:

What's in a name? Lenn stole this lead from me. (Smile) Bottom line,

"This means any product which contains the word Skype as part of the product name is in violation of the terms and should be corrected immediately. Skype does and will continue to monitor compliance with these terms."

Thus the story behind Video4Skype and vSkype.

API Development Updates Not a Road Map, but it is the best document yet for a short term look at where the API is heading. The big ones for me:

Application to Application Messaging

Web Presence API

Extensible profiles

Keep up the good work Lenn!

Boingo and Skype Zones could be a good thing. The instructions and the links suggest it's very much in early beta. If you try it with success be sure and let us know.

Skype Zones, which enables Skype usage across the Boingo network of 18,000 global hotspots. The service is being initially offered at $8 a month for unlimited Wi-Fi access for Skype calls, which is significantly less than the $22 a month that Boingo currently charges for unlimited data access. Skype Goes Boingo For Wi-Fi

I have a Boingo access at my local UPS store. I went to sign-up via the Skype Store and it takes you to a Boingo account. That then asks you for all your details. It's confusing when it asks you for a name and password. Many will try their Skype name and offer up their Skype password. It isn't yet integrated with Skype and the option is not available via your Skype Account. So at the credit point I stopped. I'm happy to open an account for when I next need it. Just let me tick a box in my Skype account and let me charge it there. Still next time I'm in an airport or another location and want to connect I'll remember Boingo and try it out.

Updates: Om Malik Andy Abramson

Go ahead cost them a few cents. Run up 10 minutes free on Skype's behalf. Click on Services in your Skype client and collect your minutes. See Skype Forum See also the Skype Blog.

Exclusive to the Skype Journal
Ring/Click. 1, 2, 3… 6, 7 seconds; Carlo and I are eye-ball to eye-ball. Fast call set up will likely be the first new feature you’ll notice in the new Spontania's new video beta 0.8.5.

Thought I would take the opportunity to let the management team of Spontania tease our readers with information about their company, technology and road map. Folded around the story they tell is our story. A review of the new features in this beta release along with the results from our video testing team─ Carlo Di Gregorio, Aarhus, Denmark and Peter Henning, Bucharest, Romania.

Previously named Video4Skype the product now goes by Video4IM. The new beta will be available for download on Monday, July 10 at about14:00 CET.

Dialcom’s enterprise system connected us for our interview. Pictured to my right is CEO Enrique Dominguez, above him is CTO Marcelo Martin-Ballestero, while above me is Video4IM Product Manager, Mario Silva Sanz.

Let’s hear first from Enrique…

Enrique, help me understand a bit about the history of Dialcom and Spontania. How long have your products/services been in development?

"We started Dialcom in the summer of 2000. We dedicated 15 months to develop our core technology. Since that time, we continue developing our technology with new products and features, for both enterprise and consumer markets. We are particularly proud of our ability to bring video to mobile devices. As an example, we can deliver 12 frames/second to a GPRS handset. We believe this is unique and demonstrates that we are a bridge between the Internet and the Mobile Telco networks."

Bill: “holy (expletive deleted)”

When did you generate your first revenues?

"Our first revenues came on the Fall of 2001."

You have sites in Spain, Germany and Portugal. Tell me about what goes on in these different sites.

"Spain is our local market, in which we have some of the most relevant references, like Banco Santander, BBVA, Repsol, Endesa and Telefonica. We also work with the most important mobile operators and ISP, like Telefonica Mobiles, Amena and Terra.
Portugal is a natural expansion for us, and there we work with Portugal Telecom, the largest Telco Operator in the country.
We recently opened our sales and support office in Frankfurt, covering DACH region (Germany, Austria and Switzerland) and Eastern Europe. During the second half of 2005 we will open sales and support offices in UK, Italy and US."

Tell us about Dialcom. How many years in business and “Spontania” is it a business unit, a product line or a brand?

"Spontania is a brand for our suit of products."

As I understand it from your web site Dialcom’s core business is the delivery of hosted conferencing services: voice, video, and data. With a particular focus on mobility─ on mobile devices such as smart phones and PDAs. What’s your competitive edge? What can you do that other companies can’t do?

"Dialcom provides real-time video communication and collaboration capabilities over IP for any device and any network - seamlessly. We extend video communications from the boardroom to the desktop and to all types of mobile devices. As previously mentioned, we believe that we can take video to GRPS, EDGE and UMTS devices from the PC environment better than anyone else. We are the bridge."

When did your developers start developing Video4Skype? Was it a difficult decision? Was there worry it would eat into your traditional market?

"We started developing Spontania for Skype in March of 2005 with several goals in mind: 1) Demonstrate our video technology using our P2P architecture, 2) demonstrate that we can seamlessly integrate into global products such as Skype by respecting their philosophy and being non intrusive and 3) develop a business partnership with Skype for premium services."

How many employees does Dialcom have? How many are directly associated with Video4IM? Tell us about the corporate culture. It seems pretty relaxed to me. I was in a video test with Mario yesterday and there seemed to be a lot of clowning around in the background. (Smile)

"Currently we are 25 employees. Out of them, three people are dedicated to Spontania Video4IM, two engineers and a product manager. Regarding our corporate culture, the core group was together before, during and after the Internet bubble. We learned a lot about working hard and having fun at the same time. The management tries to encourage people to do challenging new things to keep their strong motivation, and up to now we are achieving it."

Skype is free. Video4IM is free. What’s your business model? What story did you have that caused investors like Mangrove Capital Partners to fill your wallet with 3 Million Euros?

"As you say, Skype is free, but out of the free version comes premium services. We follow the same strategy. We are a private owned profitable company, and obviously we need to generate revenue to keep these black figures ongoing.

Mangrove Capital Partners was particularly attracted to our ability to bring video to the mobile world and our vision of becoming a bridge for video between the Internet and the mobile network."

Mangrove also invested in Skype. What business relationship do you have with Skype? Is Video4IM “Skype Certified”? Are you a member of the Skype Developer Program? If not, why not?

"As you say, Skype and Dialcom share investors and a board member. We have a nice personal relationship with Skype, but not a business relationship. We decided launching a product which reflects positively Skype’s user experience. I believe Spontania video4skype is demonstrating that good third party software is also good for Skype.
Dialcom is member of the Skype Developer program and we are currently talking to Skype about becoming certified."

We all know Skype is developing video. If Skype does for video, what they did for voice engines, how will Dialcom ever compete with the incumbent Skype?

"Beyond the free version of Spontania and independently of what Skype is planning with video, our real interest lies with how we can really be different. Regarding Spontania Video4IM, in some weeks we will announce some cool premium features; among others, videoconferencing between PC users and 2.5 and 3G mobile devices. This would drive Skype-Out minutes and open the door for new subscription models."

You have been in the Skype market for a month. Can you share with our readers the total number of downloads to date? Can you tell us something about the geographic distribution of your user base, for example the top ten countries?

"We are reaching 400k downloads during this first month. We are extremely happy with these figures, while Spontania Video4IM is a beta plug-in, and the marketing has been limited.
The top 5 geographical distribution starts with Germany, United States, Brazil, Israel and France."

What’s new in this new beta release…

Six things─
1. An upgraded User Interface with tabs.

2. Configuration Tab

Selecting “Video Device Setup” takes you to a menu for selecting video capture mode using Vfw (Video for windows) or DirectX.

3.New encryption system to improve reliability of Call Set Up when traversing through NAT Routers. THIS ALSO MEANS the new version is not backwards compatible. All users must upgrade.

4.A program to synchronize Video4IM with Skype during start up and shut down. (Join to all video calls)

5.Always on top mode selection for video windows.

6.View Tab.

The View Tab allows you to select the default viewing mode as Mosaic where your pic is inserted inside the pic of the buddy you are viewing, Float mode where your pic is moved to the side or Full Screen mode.

What’s really exciting here? It’s the enable Vfw capture. Although intended to allow older video cams like 3COM to work the two capture modes opens up a new possibilities for content distribution of video productions, animations and games such as TV as Peter will demonstrates further along in this review.

Now lets hear from Dialcom’s Chief Technology Officer Marcelo Martin-Ballestero...

About two weeks ago you gave me a demo of your whole suite of enterprise technologies…. I found it fascinating to see you hold a mobile phone up to the camera and have my mug shot moving in sync, along with yours and Mario’s. Very impressive.

"Thanks Bill, I was interested you to know the Spontania suite of products, multi-videoconferencing and collaboration for PC, PDA, Symbian, Smartphone and 3G phones. This suite of products are part of our solution for corporate and Telco markets. As you could see only a part of this technology has been used in Video4IM, but I think that will change in future versions."

So how much of this technology can we expect to see transferred to the Skype World? What features can we expect in the future?
• Resizing the video window?
• Multi-user conferencing?
• Sharing applications?
• How about recording a video session and play it back though Video4IM? Sort of a SkypeVideoCast.
• I tested sharing a TV show with Peter in Romania. This holds much promise. In fact it opens up the whole idea of delivering content from me to others? Is this an area you will explore? What tools might you have for the producers of content? Editing comes to mind.

"All this features, multi-conference, video resizing, app sharing or record&cast are actually available in Spontania. Part of this technology can be transferred to Video4IM, as well as video capabilities with 2,5G and 3G terminals."

Will you develop an API so Dialcom can create an ecosystem─ a developer community to drive innovation for Video4IM?

"We are working on that. Realize that V4S works in a full P2P environment then is a simple application in the communication side. Once we have a full release version we can work in the Video4IM API."

Tell us about what is unique in your underlying technology? Any patents? Trade secrets?
Do you do any special things to manage the bandwidth consumed versus what each user has on-hand? In simple terms how do you control frame rate to achieve optimum lip sync, fluidity, colour and resolution?

"We are in the patent process in the US of the Adaptive Bandwidth Management that provides the best streaming depending kind of network (Inet, GPRS, UMTS) and device (PC, PDA, 2,5G phone and 3G phone).
This unique feature manages all the video parameters per user. In an extreme case, a 4 Mbps stream can be served to a mobile in GPRS as a 10 kbps stream."

Are you using the native Skype API or are you using a COM Wrapper to interface.

"Just the Skype API."

What additional function(s) would you like to see in the API to improve your user’s experience?

"One unified channel for P2P communication."

From the SJ Testing Lab
We tested the first beta release on May 30
And again on May 31
Our testing group used a pre-beta release for 0.8.5. Our test environments consisted of top of the line Pentium 4 and AMD 3000+ machines, connected to the Internet at upload speeds of, 256 and 400 kilobits per second. Cameras were Logitech 4000 Pro, Logitech 4000 Quick Cam Zoom and Creative Video Blaster Webcam Go Plus. Ping times between end points were about 225 milliseconds.
In the past year, our group has tested over a dozen video products that are either on the market or about to be in the market.

What did we set out to test?
1.Call set up time when selecting “Join to all Video”

2.Quality settings vs. bandwidth consumption, latency, frame rate and lip sync for both capture modes: Vfw vs. DirectX

3.Fluidity and pixilation in Full Screen view mode while moving person moves head from side to side View image
.

4.Video capture from a TV TunerView image

5.CPU utilization for both capture modes: Vfw vs. DirectX

6.Memory usage

7.Resolution Eye Chart: lines per inch and 10 point text

8.Effect of performing a File Transfer on pixilation and Skype audio quality.

9.Finger Test for latency

Final Result: The overall opinion of our test group is Video4Skype is the best or one of the best 1 to 1 video applications we have ever tested.

Interesting things we learned…
Use the Skype Connection Analysis Tool to troubleshoot issues that arise.

Poor lip sync? Finger count delayed by half a finger or more? Check the ping time. Typically west coast North America to Denmark and Romania is about 200 to 225 milli-seconds. A bit less than a quarter of a second. So you will always have that as a minimum. Also check the packet loss. If packet loss approaches extreme levels 20 to 50 percent it probably means you are uploading packets beyond what your buddy can receive. You are likely saturating the other party’s bandwidth. It is like freeway congestion some cars don’t get through or move at a snail’s pace. Here is a pic of Carlo and I in Float Mode and using the Skype Connection Tool View image
.

Try recording a session with a product like Snagit. It’s cool.

Video4Skype has a “Quality Slider” so you can optimize the quality of the image with the bandwidth consumed. The default is 50 percent.

During our testing we found something interesting and possibly quite useful.
The Vfw capture mode uses an older Windows technology. It supports only a 320 by 240 screen, i.e. about 77,000 pixels, whereas Direct 640 x 440 provides 282,000 pixels. Whatever magic is happening I am not sure, but for the standard Window size provided by Video4Skype the apparent visual quality is the same but the bandwidth consumed is reduced by about 30 percent. So if you are on a high speed Internet connection with an upload bandwidth of 128 kbs we suggest you try the Vfw capture mode. Below is a table showing our results.

Now let’s hear from Mario Silva Sanz, Video4Skype Product Manager...
First Mario, let me thank you for letting me and my fellow Skype Video beta testers Peter and Carlo be the first to test your new release. That is very generous of you.
Mario whenever I test with you the pic is perfect. Extremely bright, incredible clarity with photoshop like images. But when I test with others I will get frequent pixilation. What is your magic? Sometimes I think, maybe Spaniards are not animated like my Italian friend Carlo. It is not bandwidth because our upload and download bandwidth is the same as when I test with Peter in Romania? Is it room lighting? Your Web Cam? Do you have CMOS or CCD? Why would I choose one over the other? Mario, help our readers create the perfect video environment? Tell us the rules and tweaks for setting up the ultimate Video4Skype experience.

"I have a simply webcam (Logitech notebook, CCD). Probably you get a lot of bright because I am sited close to a big window. Furthermore we have found that most of the users have not installed at their PCs the proper webcam driver supplied within the webcam. That’s a major requirement to have a clear picture. Also in order to get a correct balance between bandwidth consumption and video quality Spontania Video4IM integrates a button that allow the user increase/decrease video quality ate the expense of bandwidth. The bigger the video quality is, the bigger bandwith consumption is."

Many people have told me video will not be adopted. It is too intimate. Yet as we all now know the exact opposite seems to be happening. I find people more likely to want a video engagement than voice or text. What is your personal experience?

"Regarding that we have an amazing experience. We have being tracing which are the main countries using spontania video4skype. The first one on top of US, Brazil and Germany is Israel. Probably because there are a lot of foreigners working there so probably they use it for having videocall sessions with their relatives. That’s why we have also changed our mind making a very easy to use interface fully integrated with skype. Dialcom team has taken also special interest for providing users a pure peer to peer connectivity with encryption, so the user can feel comfortable using our solution."

Interesting Interview Chatter from the Video4IM Team…
Marcello: “next 3-4 months we will have really interesting functionality. The number of minutes served is climbing steadily. We are getting lots of e-mail complimenting us on the quality of our product.” Mario: In a few weeks we will have a public Forum to interact with our users.”

Mario: Although our entry into the market was with Skype we are planning in the future to move to other messenger clients. We have already had informal talks with Yahoo. This is one of the reasons for our name change to Video4IM.

Enrique: “We like to do things in a proper way. We must concentrate our resources on just a few new things at a time. For this launch it was on the web cam management feature.”

Marcelo: “The new web cam capture method (Vfw: Video for Windows) allows users to use the older web cams and more importantly capture video from TV tuners and other devices. Enrique: “This allows users to switch devices mid-stream in a call.”

What about other platforms? Enrique: “We have no problem with technology to add additional platforms. We even have our video on Symbian and other such devices. The problem is the size of the market. For example it is our understanding that Linux is only 0.5 percent of the Skype user base. “

More on their Business Model: Enrique: “We are still working on our business model. Our traditional business is focused on the enterprise. We do not want to replicate our enterprise model on Skype. We see Skype as a consumer market. So in the future when we do offer sharing we will share fun things not business things. Like Skype we will try to identify premium services, for example, calls from SkypeOut could deliver Spontania video to your mobile phone. ”

What about windowing Marcelo? Right now a user has only two choices small and Full Screen. When will that change? Marcelo: “Yes. We missed that. (Smile) So simple too. I am pretty sure we can have that in the next release. Hopefully too, we will provide recording of video streams and supporting multiple video formats.”

At the end of the road do we have a map?
So where will Video4IM be at the end of 2005?
I have no idea. You heard their management team speak. Hold their feet to the fire! Without feedback from you, they will likely get lost. But it does look like the product is worth using and following. I, Carlo and Peter certainly look forward to working with the Video4IM team as well as with vSkype and the Skype team.

Video4IM and vSkype make our Skype community a more exciting place to hang out in. The competitive pressures these “partners” bring will push Skype and Andrei the core developer of Skype’s video offering to a higher level. I think that is good for all Skype users.
Carlo; Peter. You guys are great to work with. Thanks for the many intense hours you guys tested with me. You are really dedicated Skypers! I hope I hear a big applause for you from our Skype Journal readers!

Skype issued a press release 8 July: 130 million downloads, 30 million more since April. Is this news? Many (most?) must be upgrades. Better for Skype to report more meaningful numbers:

• number of accounts,
• number of SkypeIn numbers,
• number of SkypeOut calls made,
• number of SkypeOut minutes served (total and per capita),
• number of affiliate sales,
• frequency distribution of languages people choose in their profiles,
• moving averages and peaks of simultaneous users online or in calls,
• number of text conversations.

These measures suggest the health of the Skype community, the use of Skypenet, the revenue of Skype Technologies.

30 million downloads in 45 days may be newsworthy, but explain it better. Were they from some countries more than others? How many were referred by Skype's new portal partners and which ones? What proportion were upgrades by users wanting some of the new features which came out in versions 1.2 and 1.3?

And how about some context? Are 130 million and 30 million downloads big numbers? WinZip 9.0 was downloaded 146 million times. 30 million is a little bigger than the population of Iraq, a little smaller than the population of Canada. Australians buy 130 million books a year, 130 million Chinese take the train, and American hunters kill 130 million animals. Is 400,000 a day a lot? Download.com reported the new WinZip 9.0 was downloaded 380,213 times in one week.

This news release's real significance is (a) that 130 million is the highest possible number of Skype users if everyone downloads just once and (b) someone will take more than five minutes (the time it takes to shine a pair of shoes) to write the next one.

Skype has announced "Free SkypeOut days as a new promotion. As it's summer and I'm relaxing and questioning everything I thought I question this too.

Here is the offers I'd like to see.
1. "Talk As Long as You Want" for Euro 1.00. Many countries have used this offer internationally. Typically it's done / provided on weekends. (cheaper then). Why is it good for Skype? It gets new Skypers talking for a long time. That's the behavior you want to encourage. What's the problem for Skype? I doubt they can guarantee no dropped calls and so their billing system is not up to this one.

2. "Talk MultiSkype" Conference in up to five buddies for the price of one SkypeOut call. This is another behavior that should be encouraged. It was hard to do. This one with a little tweaking could probably be made to work with the current billing system.

What about Free SkypeOut days? It's designed to cost them not very much. On the face of it to get Skypers to try SkypeOut this is an excellent way to try it. It gets them to activate an account and Skype may also get some new spikes in demand.

I don't know if Free 10 minute SkypeOut days will be the same days for everyone. And unless my Skype client tells me with an info bulletin I've very unlikely to go and check my Skype account page daily. Certainly not for 20 cents. Now perhaps that is what Skype is banking on.

They are set up and ready to go. So no harm in trying.

Spontania has renamed Video4Skype to be Video4IM. The success of Spontania's introduction, which has exceeded 400K downloads, apparently didn't go unnoticed by Skype. I don't know what was involved or what went on behind the scenes. Don't know if there was a lot of talking or if the legal papers came out. I know the parties aren't commenting publicly at the moment.

That's unfortunate. I would have liked to tell a story that Skype approached these firms soon after they launched. They couldn't have been talking before and so it caught both teams by surprise.

There's a lesson in here for other developers and for Skype. It's a story that could affect more than one developer. There are many Skype software products emerging or available with Skype used in the name.

Their new API Guidlines make it a lot clearer. Still I know it has thrown some products that are nearing release for a loop. Skype needs to make this aspect of product developement easy to talk through for developers. For if they can't piggyback effectively on Skype, then what are they developing for?

By Peter Henning, Skype Super User and Beta Tester. Bucharest, Romania

Following the review of Skype for Outlook earlier this week, we turn our attention to the second toolbar release.

The Skype IE toolbar is meant for quite a different task than the Outlook toolbar. Where the Outlook toolbar helps you make a link between Outlook contacts and Skype contacts, the IE toolbar helps you discover new contacts and phone numbers on web pages.

Left side of the toolbar


Right side of the toolbar

This feature helps you avoid a lot of copy-pasting because you can dial a phone number on a page directly from Internet Explorer. This adds a lot of convenience to calling via SkypeOut.

You have virtually nothing to set up for the toolbar to work, besides accepting it to connect to Skype. Usage is really simple.

By now most Skype users have heard or used the callto:// links. This is a very cool feature and makes it easy to call directly from the web browser. One thing we all have missed is something like a "chatto://" link. Skype for IE helps as it recognizes the callto:// links and, through Skype, lets you send a chat message too.

You have two dropdowns on the toolbar. The first called "My Contacts" for your Skype contacts so you can see their status and so that you can initiate a chat or a call from IE. The second called "Page Contacts" for the Skype names discovered on the current webpage.

One interesting feature is the possibility to send the current webpage URL automatically to a contact when selecting to chat with him/her from the toolbar. Of course this is optional and can be enabled from "Toolbar Options."

Changing status and search engine integration is also part of the package. You can choose between Google, Yahoo and Eniro.

I'd like to point out that it is still a BETA version and there are some known bugs, but nothing major.

• Dual monitors do not seem to be supported at the moment.
• Skype IE toolbar doesn't work on the secondary monitor.
• Also "My Contacts" needs longer time to load if you have a big contact list.

You should definitely try it and give feedback so it can become a useful tool for you.

By Peter Henning, Skype Super User and Beta Tester. Bucharest, Romania

Today we got a brand new toy from Skype, it is called Skype for Outlook. It integrates into Microsoft Outlook, the email and calendaring program in Microsoft's Office Suite.

This toolbar enables you to use Skype directly from Outlook and should work on all versions of Outlook beginning from version 2000 onwards on both Windows XP and Windows 2000. Skype for Outlook is a plugin for Skype therefore Skype needs to be installed on your system for the toolbar to work. As a side note, Outlook is a different product than Outlook Express which comes free with Windows and this toolbar will NOT work with Outlook Express.

Okay, nice new toy, but do you need it?

To answer this question you need to ask yourself if you are still using mail or have you moved on? To be honest I don't really use mail for personal communication anymore, but do get a lot of business related mail from people I know, which is why I love this toolbar.

Skype Staff have recognized that even though they use email less and less, some people and workplaces are still heavily reliant on email. This toolbar comes to their help in providing ways to make communication seamless.

Installation is fast

To install Skype for Outlook toolbar, just download it, run the .exe and follow the instructions. When you restart Outlook, you be will prompted to authorize an application called SKYPEOBE to use Skype. You should authorize this as it is essential for the toolbar to work.

So, what does it do?

One of the more important things about it is that it integrates Skype presence information into Outlook. Receiving mail from a contact and seeing that his is online can lead to a much quicker response and an increase in productivity to those who rely heavily on email.

Matching Outlook contacts to Skype contacts is easy.

To be able to associate a Skype name to an outlook contact just press the Looking glass icon on the toolbar. Skype for Outlook tries to find a match from you current Skype contact based on Name and Email, it if fails you can open the combobox and select it yourself. If you don't have the Skype name of that contact in your Skype contact list you can associate by typing it in. There is also an option to search for the contacts Skype name using Skype's integrated search feature.

Skype stores the Skype name information in the contact's radio phone field so you can complete this manually too.

There isn't any way of associating multiple Skype names with one contact, however I was told that this feature is something that they are looking into for the next release.

If you have completed the task successfully, clicking on an email received from Skype contact would show his/her presence and name on the toolbar.

Now after you have set up the associations is very simple to use. You can either select what you want to do from the toolbar combobox or you can just hit the appropriate buttons to call or send instant message. You can also do this by right clicking the email and going to the Skype for Outlook option.

The toolbar recognizes Skype contacts even from the cc and to email headers, giving you the ability to instantly call and chat to people who have received the same email.

You can also edit the Skype name either by manually modifying the Radio Phone field or clicking on the 'Edit Skype name...' option in the toolbar combobox.

Something that I found very neat is that Skype for Outlook enables you to call the phone numbers of Outlook contacts even without these being added to your Skype contact list.

You can also set the default country code so if the phone number in your contacts' profile is in local format (not in international), Skype can complete the phone number when attempting to call such a contact without your intervention.

Skype names and telephone numbers are also recognized in the body of an email, making it even more convenient for you to get in touch with whoever you want.

Care to start a group chat from email messages? You can do that too. Even chat topics are automatically set to the emails subject.

Credits

Special thanks for this product goes to Peter Kalmstrom who started working on an Outlook plugin for Skype quite a while back, drawing the attention of Skype management and having been hired as a contractor to develop this product. Recently he has been hired full time at Skype to continue the development of Skype for Outlook. Mat Taylor, Skype London, who manags the API and other third party develper's efforts helped do the engineering specifications and testing. Applause to both!

Other features include:

• Record journal entries for all incoming Skype calls
• Automatically add Skype callto signatures to outgoing email messages.
• Import contacts to Skype direct from Outlook.
• Open Outlook contact automatically for incoming calls.
• 
  

Later today, Skype Journal will feature another exclusive preview of another new Skype tool.

Should kids be allowed to program Skype's future? Aren't they the ones likely to make it, and show us new ways of communicating? So why would Skype set up a competition and then exclude them? That's exactly what Skype has done and I wonder why they are doing it?

Even Microsoft recognizes 15 years olds under their MVP program, which has had winners from 15 year olds to the mid-60's. Microsoft says their winners have two things in common: Great expertise and a willingness to freely share with their peers. That's exactly the type of encouragement I'd like to see given to Skype developers young and old alike.

Come on Skype change the rules again! You did it once already to change the heinous IP ownership issues. So forget the lawyers and let the kids enter. The kids are the communicators of tomorrow. Skype you ought to know better. Many of your own developers are not long out of diapers...

"Microsoft MVPs" represent a diverse group of backgrounds and professions, many of which are non-technical. They range in age from 15 years old to the mid-60's. Despite this diversity, they all have two things in common: great expertise in one or more Microsoft products, and a willingness to freely share their expertise, and their experiences, with their peers. Microsoft Most Valuable Professional

Please note that this competition is only open to non-commercial applications. Whilst we are not making any claims to source code, IP or anyother kind of ownnership we are trying to be explict in the terms about our rights to showcase your work on our web site and demonstrate them to our partners. We also cannot pretend that we may not wish to build similar tools ourself if we need to in the future. Skype Forum

It was Fathers' Day around much of the world yesterday.

The present: vSkype recieved was purely informational, but for them it was an exciting day. Five days after launching their new video offering:

272,148 downloads. 1.6 million minutes served.

I believe this to be the fastest adoption rate for a Skype plug-in.

I interviewed the person I would dub the father of both Skype and vSkype, Mr. Venture Capitalist himself, Tim Draper of Draper Fisher Jurvetson.

I posed questions for Tim in the following categories:

• The Skype Company
  
• The market for video
  
• The Skype Software Development Community
  
• The risks for Skype
  
• vSkype

Here is what Tim had to say...

The Skype Company

Is Skype a Global Telecom or secretly a media company in the making? A media company where calls are free; but content is a revenue generator?

I hadn’t thought of the media angle myself, maybe the founders have. For now, it is a communications platform. I think the biggest opportunity here is in collaborating with companies who want to do add-ons.

What are the challenges for Skype in Asia?

This is better answered by Niklas, but I think Asia mostly offers huge opportunites for Skype. Skype has great relationships with Tom.com in China and LiveDoor in Japan among others. More to come.

Stuart tells me his strategy is to move vSkype onto other presence networks, like AOL and Yahoo. What could Skype offer SCN (Santa Cruz Networks) to keep the technology in the family? Or should it?

I have always been a fan of open systems and free markets. I think SCN is best off going after multiple distribution channels, and Skype’s strategy is to work with as many application builders as they can.

How do you see SCN and Skype partnering with the other companies in your portfolio? For instance, you've invested in Akimbo, focusing on Video over IP to TV. Or your many social software plays. EVDB, FeedBurner, Meetup, Ingenio, Technorati, Wheels of Zeus and Xfire, for example. Are you encouraging Skype and SCN to broker technology or sell service to your other partners?

Great ideas. I am sure that many of them will be interested in working together. We will do our best to facilitate the meetings among them.

The Skype organization is growing at a very brisk clip. We know the Skype Application scales well, but their culture has to scale too. They seem a little thin in the manpower resources area. What is being done to make the culture more scalable?

I think Skype will benefit greatly from their API programs, from their affiliate programs and from allowing their users to continue to innovate around them. The team is exceptional and I believe they are moving in the right direction.

The market for video

This morning's (Saturday) New York Times article is about a guy in Seattle who teaches classical guitar in a number of US Cities and Spain using Videoconferencing. What other revenue opportunities do you see being enabled now that the good video technology is available? Where will we likely see the next disruption occur?

I try never to underestimate the imaginations of the creative people of the world. The "pong" videoconference game and the idea of putting a different setting behind you are two ideas.

The Skype Software Development Community

How important is a third-party development community to Skype and the Skype users?

I personally believe that there is nothing more important to Skype today than developing systems for third parties to easily add on to and plug in to and associate with Skype. We also want them (the third parties) to be very successful with their Skype relationships and a major initiative is underway to help streamline this process, while also helping consumers build trust in Skype applications.

Niklas Z has done a fantastic job of creating a huge new market ─ 40 plus million (soon to be 100 million) customers. Unfortunately these customers want everything for free. Skype is making money. But no one else seems to be. If third party developers do not make money they will soon disappear. What is an appropriate business model for the players in this market?

Give them time. Third-Parties for Skype have just begun building their applications. Soon there will be big successes from companies that pioneered using the Skype platform.

A number of developers who have seen vSkype have commented negatively that SCN has broken the terms of the Skype EULA and TOS with their Video Tab and floating V icon. This may, or may not true, I leave that to Skype’s attorneys. Doesn’t the lack of the ability to create plug-ins that map into the UI and maintain the Skype ease of use, look and feel actually hurt Skype and the third party developers? What can be done to improve this?

I don’t know about the first part of the question. I know Skype is doing everything they can to make it easy for third-parties to operate smoothly with Skype and their interface and these systems will get more sophisticated and streamlined with time.

The Platform Risks

vSkype or Spontania could add a billing system and sell video minutes using a PayPal system just like Skype did. They could add the GIPS codec to their voice engine too and improve their voice quality. This seems to be a potential risk for Skype. Skype builds this enormous global network and others take it over. Does that worry you or excite you?

That is exciting. Skype will remain open to creative and workable new solutions. There is a real benefit for a platform company to build an ecosystem that allows other companies to make money. Think of Ebay. Or even Microsoft.

SCN and vSkype

How will vSkype compete with Skype’s own video offering? Voice mail products like SAM and Pamela have failed to get even a modest toe hold in Skype’s VM market. Sure vSkype are filling a gap in a very hot market right now, but what happens when Skype delivers its video offering?

All offerings will have a different set of features and must find a market with an appeal to different users. SCN’s offering is especially good when talking to multiple users and showing things like powerpoint presentations and spreadsheets to a group. Skype’s own version will probably be more universal.

###

Rolls off the tongue.

As of now:

• Total Skype Downloads: 122,940,494
• Users Online Now: 2,296,041
• Total Minutes Served: 10,001,423,810

Milestones to come:

• 10 million concurrent users online
• 100 billion minutes served
• 1000 registered independent software developers
• 1000 Skype employees
• Zero PSTNs blocking Skype.com
• Someone from Skype as Time Magazine Person of the Year
• Dell ships millionth mobile phone bundled with Skype
• Skype office manager retires in luxury four years after Skype IPO

• 285 lifetimes
• 333 million reruns of your favorite half-hour sitcom
• US$ 1 to 2.5 billion in long distance calls not paid to phone companies

What does it mean to you?

9999888778

When will it roll over to

Just attended Cory Doctorow's keynote address - Europe’s Coming Broadcast Flag and Christian Lindholm - What is mobile life really about – Towards the seamless interplay between Hardware, Applications and Services. Cory made an appeal :

"Don’t let Hollywood’s iron heel come down on your life, your technology, your privacy, your artists and your social institutions—fight back and win the Broadcast Flag fight in Europe, too!"

Good lesson for Asia too.

The Nokia presentation was disappointing - it was about what you can do with a Nokia phone today - cam phones and lifeblog - don't we all know that already? It did not touch upon bigger issues of how manufacturers of cell phones are gearing up for VOIP applications, what they are doing to embrace the open web. He spent a lot of time on the cam phone aspects but didn't talk us through how mobile technology is about communications or networking or better quality sound or video.

Malthe Sigurdsson is on now and talking about The Skype Brand - he is sharing the Skype philosophy of keeping it simple and opening up through the forums and developer community - it works! The room is crowded with people squatting on the floor - just shows the interest in Skype here. More on his talk here.

Questions:

How do you make money and how do you decide how much money you make ? Answer - VC, building userbase - plenty of money to go around, paid-for services where potential for revenues, tie-ups with hardware manufacturers, etc

Rumour - Yahoo buying Skype ? - Answer - there's so much more for Skype to do than being bought over by someone.

Can we buy stock? Answer - yeah we have stickers here :):)

Payment issues - Answer - being worked on - perhaps develop hubs.

Stuart is on this this afternoon talking about What's your presence strategy?

tools

I'm in lust for the Minivox speakerphone - perfect size to go with your phone or laptop.

The $70 microtelPC desktop that comes with two VoIP solutions inside: Skype and Earthlink's SIP tool (thanks, Angelique).

Jybe: A free browser plug-in, "Jybe allows users to make Skype calls, share documents, and send invitations from Internet Explorer and Firefox." "You can now initiate a call to your Skype users directly from JYBE. Simply invite them from within JYBE and they will be automatically called and IM-ed to their Skype user name. They can now join your session instantly." The Skype API at work.

Geeking out

Great EE Times interview with Niklas Zennström if you're a phreak. "We're using different codecs for different circumstances. For instance, if you have a broadband connection, we are using one codec and if you have a narrowband connection, we are using another." Makes me want to whip out a fuzzy logic engine to optimize codec selection. Do you think the Skype client renegotiates codec choices mid-conversation? via El Contexto es Todo (es)

Skype's network has some serious flaws, including the inability to retire or recycle user IDs or to authenticate callers. If you're interested in this stuff, see Doc Searls' pile of links from Digital Identity World. (I missed the DIDW conference to take this picture. Cost of trip: $2000. Image of Jeff Pulver eating a sandwich in his conference room: priceless.)

How do people Skype?

• Priit, an Estonian exchange student in Shanghai, tells about getting Grandmother to use Skype.
• Home-bound blogger Skypes Phoenix police about noisy neighbors.
• InfoWorld's Chad Dickerson gave up Skypecasting:

  I've concluded that while Skype is really great for informal phone calls, using it as the platform for recorded interviews is simply ill-advised. I'm pretty sure this will be the last interview I do with Skype. Frankly, the people I'm interviewing (and planning to interview) are too busy to repeat the key moments that are ruined by Skype jitter/flutter and I feel like I'm insulting busy listeners if I force them to listen to garbled conversation (even when it is very sporadic). I haven't gotten any specific complaints about this from listeners or interviewees, it's just something that bugs me about the first two. This is one area where the Principle of Good Enough doesn't apply -- either you hear words clearly, or you don't.

• Man admits addiction to Skype, TiVo as gateway drug.
• Case study of hi-tech field sales organization using Skype on the road, saves money. (jp)

Will you be the first to register Skype.xxx? And could it be the next great VoIP business model?

Jaanus in his Share Skype blog interviewed Sefan Öberg Skype London's Director of Product Management.

This is a good move for Skype. Sharing is Good is more than a theme about product.

It is pretty clear that their product which based on a Peer 2 Peer architecture is highly scalable. Since Skype chose a stealth mode of operating we have no way to determine if their corporate culture is scalable as it clearly must be.

The new Skype Windows beta release 1.3.0.29 has two new features I like.

1. Voice Messaging.

Sweet.
As a VM subscriber I can now send a Voice Message up to 10 minutes duration to anyone in Skypeland. That will make Stuart happy. He requested this feature a few weeks ago here.

Sour.
Along with the voice message the recipient gets this "i" for information icon message and an advertisment:

So far this is tastefully done. Let's hope it stays that way.

2. The Start Menu is gone and with it some bloat. It is replaced with a Services and Events bars underneath my contacts list both of which can be minimized achieving an uncluttered look.

View the Change Log here. Lot's of positive new changes.

Skype announces that they are no longer in Beta with PayPal. Now you can use PayPal wherever it's available. It's an interesting partner for Skype. Will announcments with eBay be next? What's the affiliation deal for PayPal worth when they sign up new Skype users. Hmmmmm aren't those PayPal users some of the early adopters? Strike up another win for Skype.

“With nearly 72 million accounts worldwide, PayPal is a proven online payment method for online shoppers,” commented Geoff Iddison, chief executive of PayPal Europe. “The partnership with Skype brings PayPal a global opportunity to expand our user base. PayPal enables Skype users to pay for the Skype services in a seamless and secure way. We look forward to sharing the convenience and security of the PayPal system with Skype users.” Skype

Niklas Zennstrom's presentation from VON Europe. What's changed and what's been updated since VON Canada?

Insert positioning Skype as providing free global roaming particularly with SkypeIn. Added in details on the affiliate program and providing a similar although stronger point of view on regulation. Plus still thinking ecosystem.

• Encouraging evangelizers
• Extensive API which is free to use
• Accessories which are Skype Enabled are very attractive to consumers
• Existing users recommend Skype to friends (as long as we are honest and respect our users)

Download file

Simon Perry of Digital Lifestyles reports from Von Europe where he interviewed Niklas yesterday who announced the formal launch of the Skype Affiliate Program.

There will also be "super affiliates" that will have their own Skype account manager - a first for them. The first two announced are Luna Storm in Sweden and SuperEva in Italy. Luna Storm is a online phenomenon in Sweden, having over 2m members, which in a country of 9m in total is pretty impressive. Skype Affiliate Programme Becomes Official - Digital-Lifestyles.info

The Skype PR announcement

Dial 911 in Skype. This is what you get.

How many voip services can give you this feedback?

Personally, I think this is a mature response. This is Skype starting to think like a player engaged in a contest for political power with gargantuan telcos and cable companies. And a software company listening closely to its users. And its lawyers. I hear stories that telcos routinely spend eight times their R&D budget on "government affairs," a barrier to entry for new entrants. Since half of Skype's staff are involved in product development, that's not the case here. Yet. Read on to see the ex parte letter Goldberg filed on behalf of Skype.

LAW OFFICES
GOLDBERG, GODLES, WIENER & WRIGHT
1229 NINETEENTH STREET, N.W. WASHINGTON, D.C. 20036
HENRY GOLDBERG
JOSEPH A. GODLES
JONATHAN L. WIENER
BRITA D. STRANDBERG
LAURA A. STEFANI
HENRIETTA WRIGHT
THOMAS G. GHERARDI, P.C.
COUNSEL

(202) 429-4900
TELECOPIER: (202) 429-4912
general@g2w2.com

May 10, 2004

Electronic Submission

Marlene H. Dortch, Secretary
Federal Communications Commission
445 12th Street, S.W.
Washington, D.C. 20554

Re: WC Docket 04-36 Ex Parte

Dear Ms. Dortch:

On May 9, 2005, Skype Communications, S.A. (“Skype”), represented by Director of Operations Michael Jackson, undersigned counsel, and Brita D. Strandberg of this firm, met with Chairman Martin’s Chief of Staff Daniel Gonzalez and Michelle Carey, Legal Advisor to Chairman Martin, and separately with Commissioner Copps and Jessica Rosenworcel, Legal Advisor to Commissioner Copps, to discuss the application of 911/e911 requirements to IP-enabled services.

Specifically, Skype explained its position that those providing IP-based replacements for fixed-line wireline telephone service should provide equivalent access to 911/e911 emergency response services as available to consumers using the telephone services for which they are seeking a replacement. In this way, consumers, who expect to have access to emergency response when they replace their fixed-line telephone service, will not be exposed to potentially dangerous situations if their reasonable expectations are not met.

Skype emphasized that the Commission should define IP-based replacements for fixed-line wireline telephone service as services that:

• Assign users NANPA/E.164 phone numbers;
• Offer as a package real-time, two-way service that is able to receive voice communications from the PSTN and terminate voice communications on the PSTN;
• Provide, or enable use of, traditional CPE or CPE that, like traditional CPE, is always on and has dial tone.

Use of this definition will ensure that consumers buying phone service that is marketed as, and intended to be used as, a replacement for fixed-line wireline telephone service will be able to reach emergency services.

Naturally, Skype itself will abide by this proposal and will offer access to emergency response whenever it offers services meeting these criteria. Indeed, Skype is planning to integrate its IP offerings with its own WiFi handsets and will support the provision of reliable user location information to emergency services when consumers buy those handsets.

In the interim, Skype is concerned that overbroad application of 911/e911 requirements will impede rather than facilitate the provision of emergency services. Skype does not have access to reliable real-time location information for its users – Skype may determine a user’s IP address, but IP addresses (in addition to being vulnerable to spoofing) offer only the most general sense of a user’s location. Of course, Skype could request location information from users, but any self-reported information is likely to be unreliable. Skype users typically use Skype from laptops or from several computers, logging into their Skype accounts from home, work, hotel rooms, airports, Internet cafes, and anywhere else they have access to a computer and a broadband connection. Consequently, any user-reported location information, even if initially correct, will accurately describe a user’s location only some of the time, and could be off by entire continents.

Because it does not have and cannot obtain reliable location information from its users, Skype currently is unable to deliver emergency calls to the proper PSAP. It is likewise unable to transmit location and callback information. A Skype call to emergency services would run a serious risk of being routed to the wrong PSAP and would contain unreliable information once connected. Adding capability for such calls to Skype would reduce user security by creating a false impression that Skype can and should be used to reach emergency services and would burden PSAPs with improperly routed calls and unreliable information. Skype has addressed this limitation by warning users that Skype should not be used as a telephone replacement service and cannot be used for emergency dialing

For the reasons discussed above, Skype urges the Commission to limit the immediate application of 911 and e911 requirements to IP-based replacements for fixed-line wireline telephone service as defined herein.

Respectfully submitted,

Henry Goldberg
 Attorney for Skype Communications, S.A.

cc: Commissioner Copps
Michelle Carey
Daniel Gonzalez

Jessica Rosenworcel

About one-hour ago Skype began its blog! The main man running the blog is Estonian, Skype Staffer Jaanus Kase or known by the more familar handle "terminus" for those who visit the Skype Forum.

So the competitive pressure is on the Skype Journal. Well anyway I think we beat Jaanus with the news about 3 Million users online. :) :)

The site is bright; breezy. New facts too.

Congratulations Skype. Good work Jaanus!

Skype won the 2005 Webby Award for Telecommunications. The Webby, called the “Oscars of the Internet” by the New York Times, is an award honoring excellence in Web design, creativity, usability and functionality. PR Newswire

iBasis reports Skype is a major customer of its DirectVoIP™ Broadband service.

If you have a Windows Smartphone with GPRS (I'm waiting for the Symbian version) and an account like T-Mobiles unlimited $20/mth GPRS connection and love Skype then you will want to try out this beta. I'm sure this is the application I saw running on Niklas's iMate in Toronto. It's slick, it doesn't provide voice over GPRS, merely presence and text messaging. As a user of Agile messenger that's a pretty good start. Here's the link to the Skype Forum post.

We have early version of Skype for Smartphone available. Please provide feedback directly to me or in this forum.

Skype for Smartphone BETA
* participate in Skype network - log in, presence
* instant messaging
* centrally stored contact list support

Things to be aware of
* no voice (yet)
* network traffic usage - depending on your buddy list network usage can be quite large - up to several megabytes per day even without actively chatting, this is important if you pay per megabyte. There is option automatically disconnect then Skype is in idle and it's switched on by default, feel free to switch it off if you have flat-free rate.
Skype Forum

Download

From the Skype DevZone:

We at Skype, are very excited to present our first public competition. It's a competition for developers (that's software developers, not property developers). We would like you invite you to enter.

We're giving away 5000 Euros of cash prizes and in return we'd like you to use our API to develop applications that show-off the potential of Skype, and make it even easier and better to use in the future.

You can put forward as many entries as you like. All we ask is that you're happy for us to make them available to download for free from skype.com and that you get them to us before the deadline for entries on July 1st 2005.

After you work your way through the Details, tell Skype Journal about your project. If you're blogging it, send us a link. For some insights, be sure to read the free Skype Journal's "Learning Skype's Plug-In Architecture" guide.

Skype Journal confirmed that Skype users in the United Arab Emirates are blocked from the Skype.com web site. This prevents users of the Skype internet telephone system from buying minutes to call at highly discounted rates, of special importance to the many expatriates who work in Dubai. We don't know where the actual blocking is taking place (presumably at Etisalat's Emirates Internet and Multimedia, the only ISP in the UAE), at whose direction, or for what purpose.

Motives may be economic. About 2.5 million people live in the UAE, 1.6 million are non-nationals. There are more phones than people: 1.1 million land lines (operated by Etisalat) and 2.9 million mobile. Etisalat has a monopoly on telephony.

The motive may be one of political control. Skype automatically encrypts conversations, making it costly and difficult to tap conversations or determine calling patterns.

Download the Niklas' presentation (PowerPoint, .ppt file) courtesy of Jeff Pulver. Or watch the presentation in your browser (flash, .swf file).

I have plenty of material to absorb. Some new learnings and no radical announcements. I sat through Niklas's pre lunch presentation and have just finished making notes from his hour long press conference. He's been the draw card here this morning although Tom Evlin injected some new thinking for many in the audience. See his post here. Bill and I will write up our notes after our interview with Niklas. We have a few questions still to ask.

Here's Niklas and Jeff.

Does Skype think and act like a mobile operator? Is that the model Niklas wants people to focus on? Is that really the end game?

How important is the confirmation that Skype thinks and models elements of their strategy on mobile operators? Still, I'd be careful about taking this one too far. Niklas in the article below makes a good point relative to mobile operators and the enterprise suggesting that a similar approach is appropriate for Skype. Still I can't see Skype investing in the infrastructure like the mobile operator and they already differ in developing strategies for phones with embedded Skype.

Niklas Zennstrom: I think we probably answer the same way as a mobile operator would do. Mobile operators are happy to sell access to their network, but they’re not building a private network for an enterprise Mathaba.Net

For those of you who were playing on the edge with a beta we now have a new formal release... 1.2.0.41 most important for those operating behind a proxy server or testing SkypeIn

Change Log
06.04.2005 version 1.2.0.41
change: improved translations
change: improved chats and calls connectivity behind proxy
change: improved logging in behind proxy
change: improved Central Contact List
change: if a SkypeIn call is sent to voicemail, custom greeting is played
change: mute microphone for 200 ms when playing DTMF tones to avoid echocancellation interfering with tones
bugfix: installer failed to write avatars to destination directory on some setups
bugfix: calls between version 1.2 and version 1.1 or older did not work in some rare cases, there may have been silence or noise in both directions
bugfix: entire chat was resynced in some cases

Go get it...

As an owner of a Dell Axium X30 this makes me a happy camper. Packed with 6 new featues all which were on my wish list...

Here is the changelog:
feature: ability to leave Skype Voicemail
feature: SkypeIn support
feature: centralized Contacts list
feature: support for high-resolution display
feature: SkypeOut fixes (calling to France numbers)
feature: exit and close Skype application from Tools menu
change: additional languages (German, French)
change: improved communication security
bugfix: error message when calling from search result
bugfix: blocked contact offline icon incorrect
bugfix: incorrect message in case of password change
bugfix: Skype was unusable on Chinese PPC

In an announcement dated February 2, 2005 SuperEva an Italian dating and matchmaking site signed an agreement with Skype and is now hosting "Sirens and Studmuffins" with a "promo" prize being drawn June 17th. Apparently knocked up for Skype and Plantronics as a promotion it appears almost in stealth mode with less than 100 entrants.

Sviluppato all’interno del sito www.sirensandstudmuffins.com powered by superEva.com, tale concorso viene promosso anche all’interno dei network televisivi delle universit inglesi e prevede da parte degli utenti di Skype e di superEva.com la compilazione di un form con i dati personali e alcune informazioni aggiuntive per “inquadrare” meglio ciascun partecipante agli occhi degli altri iscritti. DADA.NET

Updating myself on Daum-Skype, seeing the reference to Jyve and Someonenew via the NY Times article this morning suggests it is time for a review of Skype, dating and social networking sites and opportunities. There are better ways for Skype to involve themselves and take social networking sites to a new level.

Change log:

23.03.2005 version 1.2.0.37
feature: Central Contacts List
feature: Voicemail
feature: SkypeIn
feature: Getting Started Wizard
feature: Promote Add To Contacts
feature: toolbar added to call tab
feature: File Transfer - ability to select multiple files to send
feature: Import/Export contactlist from/to vCard
feature: API: possible to initiate conference
feature: added exitsurvey when Skype is uninstalled
feature: chat /alertson * /alertsoff

There are many bug fixes.

This looks like a worthwhile download. Release notes suggest voice quality is improved... hard to believ it could get better. :)

Skype for Linux joins the Mac and Windows with voice mail and a central contacts capability.

This release has many cool features, among others SkypeIn, Voicemail and Central Contacts List. It is compatible with the recent betas of Skype for Windows and Mac OS X so one major shortcoming in Skype is now over - you can use the same contact list in all machines without manual copying or re-entering. Also, we have contact groups - those are not part of central contactlist yet but will be.

There's a tech change too - feedback welcome on this. All versions except the static one now require glibc 2.3.2. The static one is still based on 2.2.5 and can be used on older systems too, but in other builds, we're moving to newer glibc. Skype Forum

Now Skype complaints go directly to Skype. In one intersting snip from CNet's update on Skype is the announcement that Skype is now handling customer complaints inhouse.

One area where Skype is facing escalating costs is customer service. The company has been hit recently with an unusually high number of complaints over billing and credit-card-related errors, Zennstrom said. In response, Skype last week ended its contract with an outsourced customer service provider and moved the function in-house.

"Outsourcing was a mistake," Zennstrom said. "We now have better controls, and tracking to make sure complaints are addressed and followed up...We take customer service very seriously, and I believe we have taken the necessary steps to improve."
CNET

Kevin Railsback at InfoWorld made Google News first on the availablity of a new Skype Beta for OS X Mac users this morning. The beta adds SkypeIn and Voicemail,plus the centralized contacts list.

# feature: contact list groups
# feature: SkypeIn and Voicemail
# feature: Central Contacts List
# feature: send SkypeOut contacts

Prices for SkypeIn (Euro 30) and Voicemailare the same for Mac users!

Download
ChangeLog

First 10000+ likely to be the lucky ones. In a new beta 1.2 Skype takes on traditional telecoms with significant usage enhancements. As reported last night it costs Euros 30 for one year. I registered a 415 area code earlier today. I also paid using PayPal avoiding the Moneybookers option. I understand it will take a few more hours for my number to become active. I'll report later on the more detailed feature changes. Note this beta also provides a Voice Mail where the messages length is now extended to 10 minutes!

# feature: Central Contacts List
# feature: Voicemail
# feature: SkypeIn
# feature: Getting Started Wizard
# feature: Promote Add To Contacts
# feature: toolbar added to call tab
# feature: File Transfer - ability to select multiple files to send
# feature: putting SkypeIn and SkypeOut calls on hold
# feature: Import/Export contactlist from/to vCard
# feature: API: possible to initiate conference

Skype for Windows Change Log
Download Skype for Windows 1.2 Beta (6.4 MB)
Version: 1.2.0.21. Release date: March 10, 2005
Download Skype for Windows

Skype slips into their website help section a new knowledge base which unofficially reveals their pricing strategy for voicemail and SkypeIn. As expected it confirms that voice mail will be free with the purchase of a SkypeIn number. The site update suggests that a new SkypeVM version will be released "very" soon. Perhaps I'll have that SkypeIn number before next week! There are no real surprises in the rate which are very competitive. It's unclear whether any significant additional voice mail features will be in the next release for Windows.

Skype Voice Mail:

The price for Voicemail is 5 Euro for a 3 month subscription or 15 Euro for a 12 month subscription. If your billing address is in the EU, you will be charged 15% VAT when you purchase a Voicemail subscription. Therefore the prices will be 5.75 Euro for 3 months and 17.25 Euro for 12 months. However, a Voicemail subscription comes free with purchase of a SkypeIn number!
Skype Help

SkypeIn

The prices for one SkypeIn number is 10 Euro for a 3 month subscription or 30 Euro for a 12 month subscription. If your billing address is in the EU, you will be charged 15% VAT when you purchase a SkypeIn number. Therefore total price with VAT is 11.15 Euro for 3 months or 34.50 Euro for 12 months. Skype Help

Country Availability and Numbers::

Initially, SkypeIn numbers are available in the US, UK, France, and Hong Kong. We plan on adding more numbers and locations at a later date. (Link) For now, you can get numbers in a selection of top US cities and states, 0870 numbers in France, 0207 numbers for the City of London in the UK and 819 numbers in Hong Kong. (Link)

I received a headsup from Simon Perry who introduced me to the Skype Broadreach deal. I had to read his piece and the newwirenet story twice to get it. I think it's brilliant and it stands a good chance of catching on. Example of where at why at the end of this post.

What the deal means.
You can Skype at Broadread Wi-Fi Hotspots thoughout England for free! Locations!
Encourages the use of Skype in mobile locations

Why's it interesting?:

Skype may drive more people to hotspots, find local ones etc.
Broadreach hopes you will log-on get your e-mail etc as well. That will cost you money.

Skype becomes a vehicle for promoting and trialing Wi-Fi hotspots

Where could this go?...
For some time I've thought that Skype should trial some booths in "international" airport zones. It's the perfect place to showcase Skype, platforms and devices. I'd expect someone will be retailing / providing this before long. Concurrently the Broadreach deal suggests a solution to bandwidth and services. Most airports have a "supplier" still this is a neat proposition. Similarly with the high traffic in European train stations they provide a perfect opportunity to match Skype with Wi-FI.

See: newswireless.net

"Broadreach is a leader in the UK wireless market with a very high number of customers passing through its network locations and creative deployments such as Wi-Fi for rail passengers. Broadreach's understanding of, and relationships with, the transport industry makes the collaboration a compelling one for us and all UK Skype users," said Niklas Zennström, Skype CEO and co-founder. "We will continue to deliver our wireless strategy and efforts to make Skype ubiquitous". Skype Announcement

It will be interesting to see if T-mobile will apply this deal to their HotSpots in the US? If not perhaps Virgin should explore it.

See also:
The Register
WNN Europe
The Test Bed Blog
Ben Hammersley

Skype spokeswoman Kat James acknowledges problems but says the customer numbers tell the bigger story.

"Skype constantly monitors call performance across the global network of users and seeks to enhance quality through continuous product development," James said. "As our growth indicates, we have a huge number of satisfied customers." Skype callers: 'Customer service, please?' | CNET News.com

Another point of view from ZDNet on the exciting news that Motorola will be working with Skype. We tend to agree. This is an exciting direction and one which will a "cellular" provider will test as the new devices come out and down in price. Keep a watch on Asia or Europe, it's not likely to happen Stateside first.

I believe this is exciting news. Rather than be forced to opt for a fee-ridden cellular phone plan, free or bundled-in VoIP will give at least some cell phone users a choice.

The Wi-Fi component of this set-up wouldn't be of the hot-spot variety. This would be more of a short-range transmission thing. Your Motorola phone would likely obtain Wi-Fi connectivity by hooking up to your existing broadband connection at your office or home. ZDNet

Xandros is now shipping with Skype for Linux. How long until Dell or HP ship with Skype?

Linux distributor Xandros on Monday released a non-commercial version of its distribution that includes the free Internet telephony application Skype.

The release, Open Circulation Edition version 3, can be downloaded free of charge from the Xandros Web site. ZDNet

Robin Good and James Enck have the scoop on yet another Skype deal. Could this be the deal that Nokia should have done first? In other news MS is moving faster with cheaper wireless solutions.

Motorola has today also answered Niklas Zennstrom's love-call. The press release isn't on either site yet, but the alliance focuses on "co-marketing of new optimized Motorola 'Skype Ready' companion products, such as Bluetooth headsets, dongles, and speakerphones, as well as delivery of the Skype Internet Telephony experience on select Motorola mobile devices." EuroTelcoblog

James also writes that he's just revised his timetable, in his view anything you thought was going to happen (just got faster) --- longer than 12 months and says "find it increasingly difficult to putting money into this sector". The MCI deal like AT&T for just a few billion show just how worthless these assets are becoming.

Meanwhile I'm looking forward to the Skype upgrade that allows me to use my Motorola BT headset's answer button with Skype. Then manufacturers just found another way to boost interest and demand for bluetooth headsets.

A concise summary of what it is like when SkypeOut doesn't work. It's frustrating.

And wow! are they saying things! I was really surprised indeed to see the sheer volume of complaints in there by people who are having real issues with making phone calls via SkypeOut, to many countries. Even if you take away the more emotional and rude postings in that forum, there are a lot of people who are very unhappy with the quality of service.

These people are paying customers. They have coughed up money to buy credit to use a service which, for one reason or another, doesn't seem to be delivering (and actually isn't, in my wife's case). And they don't seem to be getting answers from Skype.

Whether the problems relate to the normal phone network or not, people really couldn't care less. All they know is the service doesn't seem to work. And that translates into a dissatisfaction of the service overall. And they'll tell their friends: "Yeah, Skype's cool but calling [friend X] in [country Y] just doesn't work."

Skype Has a Problem With SkypeOut

Skype recently announced a deal with HGC in Hong Kong while news is now breaking of another deal in Korea with iMate. iMate is the largest distributor for Windows Smart Phones. Both these announcements are interesting. They also suggest a "quickening" for the pace of change. So far the HGC release looks similar to the old formula applied elsewhere. (Scary after deals in Taiwan, China, Japan and Korea, we can call this version common place.) with one difference. HGC is a landline operator. In the case of iMate it is a technology story. Now we have a Smart Phone distributor promising Skype mobility with your mobile. Skype's PDA version is already running on some iMate products.

I keep thinking about the impact on "you and me" when I see these deals. Tonight I'm wondering when I can buy the "mobile" that provides me "Skype" and drop in my GSM Sim card. Under $500. Then all I care about is whether SBC or T-Mobile is going to enable SkypeIn for me. My preference is for my mobile number. So:

How long until Skype is infecting the common mobile phone? While we have had a Window PDA version (just announced as 1.0) this suggests that the capability to put Skype into Smartphones effectively must be close to a beta test release. (I only know of rumors re Symbian). Last week I suggested the potential for a stripped down SkypeMobile version and impact it could have on SMS revenue. This SmartPhone play suggests things are moving along faster. Still even a Skype with limited voice messaging on a GSM / GPRS phone could make an attractive proposition.

Will the iMate deal bring new integration between the mobile Skype client and the desktop? For those that may have forgotten, You can log on multiple times same profile on concurrent PC's with Skype. They all ring on the inbound call. So what are the implications for inbound mobile calls after this Skype client is installed? Could any inbound mobile call number be forwarded via Skype text to my Skype Desktop? What happens when the inbound mobile caller is also a Skype buddy? How will adding "Mobile" to presence status messages affect contacts and call behavior? Will this also increase the potential use of SkypeVM? As noted before, why text a buddy who is likely to be driving. Can that PDA / mobile on Wi-Fi also be the phone around home?

Will HGC be the first to announce a SkypeIn deal? That would mean that everyone in HongKong could simple take their home number with them, anywhere they were on Skype. Seems silly right? Why would a landline operator want to provide the number? Looking at the iMate deal perhaps it makes sense. SkypeiMateMobile (call it what you want) could then receive an inbound PSTN call to Skype using an HGC inbound number. In the iMate case that could enable a second line or extension on your cellphone. What's more the second line also starts to become associated with all the neat presence info. In this twist of fate consumers might look for "fast data" connections only from their mobile operators.

See also:
Mark Evans
Jeremy Wagstaff
Andy Abramson

PCTel recently announced a new solution that means your mobile could soon be using the same number as Skype. Wouldn't that be useful?

PCTel's new product permits users to make and get calls using the same number on cellular and IP networks. InformationWeek

Business Weeks Online Tech Beat reports with Telcom mergers in all the news that tipping point for the old telecoms is already recognized by 22 million people. That's more than a small country!

Not really. The big mistake many people make with new technologies, from personal computers to the World Wide Web and, most likely, VOIP, is to compare them with existing ways of doing things, and then--big surprise!--they don't measure up. Yet already, more than 22 million people, plus 70,000 more every day, think Skype is more than good enough, and no doubt it will get better. What's more, it offers much more than POTS--such as the ability to know if someone's available before you call and set up conference calls with a click. Let the so-called experts argue over how many years away the tipping point is. I and 22 million other people already know it's here. Tech Beat: Technology Blog on BusinessWeek Online

A key company keeping Skype at the forefront of "voice" technolgies is Global IP Sound who today announce further upgrades to their voice engine. Key elements in this announcement that adds an enterprise focus, improved noise supression and improved latency. Their claimed 100ms in latency superiority over any other system is huge! Skype probably has all these enhancements bolted in already. This is also another market that "Push to Talk" will be a future feature.

2.0 provides better-than-PTSN voice quality and a variety of new features optimized for enterprise-class VoIP, such as noise suppression, GIPS NetEQ 3.0, push-to-talk capabilities and Telchemy VQMon support.

2.0 will bring enterprise VoIP to groundbreaking levels."

NetEQ reduces jitter buffer delay by 30 to more than 100 ms over the most effective alternative solutions. NetEQ also automatically eradicates the clock drift problem inherent in difficult PC environments. Global IP Sound

Skype for Mac and Linux are out of beta with the announcement of OS X Version 1.0 and Linux Version 1.0

We are glad to announce that Skype for Mac OS X 1.0 is now available for http://www.skype.com/products/skype/macosx . It marks an important milestone in development for us since the first Skype for Mac OS X public beta was released on August 31 last year.

I would like to underline that "version 1.0" is not the end of the road for us. There is a lot to be done in both improving existing features and adding missing ones (for example group chat). Skype has announced a lot of new exciting features and services for 2005 - voicemail and SkypeIn, just to name a few - and these will obviously be supported in the Mac OS X version, alongside others. Skype Forum

I think I prefer this view of the world. How can a phone company invest $16billion and not think about what Skype has set in motion so far. From CNet in relation to the announcement today.

The number of new Skype users is increasing at rates not seen since the early days of instant messaging, and at no cost to Skype other than hosting a Web site to make the software available, and "making software tweaks," Skype CEO Niklas Zennstrom said in a recent interview. More than 140,000 new users register each day.

It would cost phone companies still using traditional means untold billions in construction, marketing or merger costs to come close to matching Skype's growth rate. And they are running out of companies to buy. Recently, SBC said it plans to spend $16 billion to buy AT&T; while Sprint finds $31 billion to pay for Nextel Communications. Cingular Wireless vaulted to the top of the U.S. carrier heap last year when it bought AT&T Wireless. CNET News.com

The claim is now 140000 new users per day, that up from 80000 the last time I saw the number.

Skype for Mac and Linux are out of beta with the announcement of OS X Version 1.0 and Linux Version 1.0

We are glad to announce that Skype for Mac OS X 1.0 is now available for http://www.skype.com/products/skype/macosx . It marks an important milestone in development for us since the first Skype for Mac OS X public beta was released on August 31 last year.

I would like to underline that "version 1.0" is not the end of the road for us. There is a lot to be done in both improving existing features and adding missing ones (for example group chat). Skype has announced a lot of new exciting features and services for 2005 - voicemail and SkypeIn, just to name a few - and these will obviously be supported in the Mac OS X version, alongside others. Skype Forum

I think I prefer this view of the world. How can a phone company invest $16billion and not think about what Skype has set in motion so far. From CNet in relation to the announcement today.

The number of new Skype users is increasing at rates not seen since the early days of instant messaging, and at no cost to Skype other than hosting a Web site to make the software available, and "making software tweaks," Skype CEO Niklas Zennstrom said in a recent interview. More than 140,000 new users register each day.

It would cost phone companies still using traditional means untold billions in construction, marketing or merger costs to come close to matching Skype's growth rate. And they are running out of companies to buy. Recently, SBC said it plans to spend $16 billion to buy AT&T; while Sprint finds $31 billion to pay for Nextel Communications. Cingular Wireless vaulted to the top of the U.S. carrier heap last year when it bought AT&T Wireless. CNET News.com

The claim is now 140000 new users per day, that up from 80000 the last time I saw the number.

Skype and PChome announced today a USB phone for the Taiwan market. In addition the press release provides updates on Skype subscribers, and plays for Siemans to release Skype enabled mobile devices in 2005.

See Taiwan market: Skype launches USB phone

Skype Technologies, a global P2P (peer-to-peer) Internet telephony company, announced the availability of the “PChome Touch-1” USB phone with a built-in Skype API (Application Program Interface) in Taiwan yesterday.

The Skype P2P voice-over-IP (VoIP) application now has about 21.3 million subscriptions, worldwide, and downloads now total 50 million, according to company CEO Niklas Zennstr�m speaking at the press conference yesterday. In Taiwan, the P2P VoIP software has achieved 1.04 million subscriptions and 2.6 million downloads since it was launched in July last year, said Zennstr�m.

Skype aims to extend the P2P VoIP application from desktop PCs to mobile devices in 2005, Zennstr�m stated. Siemens Mobile has begun incorporating the free software into its mobile phones since Skype is compatible with Windows-, Linux- and Symbian-based handheld devices, according to Zennstr�m.

In addition, new Skype services will be rolled out in 2005, including video conferencing and voicemail, said Zennstr�m.

The “PChome Touch-1” USB phone was manufactured by Taiwan’s online PChome Publications, according to PChome, and the Taiwan-based Internet company aims to shift its core business to hardware manufacturing. PChome plans to set up an R&D center for incorporating Skype into PC peripherals, including wireless phones and WiFi phones, said the company. All Skype-based products need to obtain verification from Skype’s headquarters in Switzerland, the company noted

Taiwan market: Skype launches USB phone

Skype is on the verge of obsoleting their text messaging system. Today a new Skype Beta 1.1 for Windows is available with mulitparty chat. The chat solution is very very elegant and solves the problem that all conference users have had (which chat client to use?). See using Skype Chat. It also has some nice memory features, including "recent chats" and "topic" capabilities. Plus... a big plus.... "When you are in a chat with several people (the new text chat in 1.1), the button in toolbar changes its shape and its tooltip is "Send File to All". And it does exactly what it says." from the forum. Try it.

Beta version available (advanced users only)
This beta version contains new features which have known issues. Before you download it, make a backup of your contact list and all data. New Skype users should not use this beta version. Download Skype for Windows

Now I just need a streaming solution so the conference call between an expert panel (still limited to five) can be streamed to the up to 50 skype participants. Then questions can be taken and new members invited to the conference call as required.

News of Skype's API is leaking out slowly with a few rumors here and there. I'm been quiet as I've been in the beta forum and some of my best Skype buddies have been busy readying some new presence solutions. However the Skype API forum and API details

It's now possible to build Skype tools into your own website, or other applications. Nobody officially knows this, of course, because, typically, Skype Technologies hasn't actually announced it -- but if you download the latest build today, you'll spot the innovation in the install log.

What on earth is a Skype API? Skype is an instant messenger, but specially designed to allow non-expert users to talk to each other over the Internet. The trick is available with rival IM services like MSN, AOL and Yahoo but many users find it hard to set up. Skype's install is comparatively idiot-proof. And the API means that programmers can add the Skype IM features to their own work. PCWorld

The first big surprise will be a Skype Presence Server developed outside of Skype. It will enable a new market for presence. A market where you and I can choose who brokers our presence information and when and where it is shared.

It looks like you can do quite a bit. The first is part of how a USB phone can use the API. The second is what third party software can do. And it looks like you can place calls, IM, view a user profile, and probably some more stuff. You can even have two apps use the API at the same time.

This could get interesting. Documentation for the API is expected to be released in November, and some companies are quietly working on easy to use API wrappers to allow Skype to be used through Java and web apps. RossCode.com

This slow leak style appears to be the norm for Skype now. See also NewWire

The Skype API has huge potential. It will immediately provide opportunities not available with other messaging services and has potential to grow a whole new market for information services. My belief is simple. If Skype's API release is successful then not only will growth accelerate, it will gain a huge innovation advantage, bootstrapping on resources that as a small company they could otherwise not afford. That's been the successful software model for awhile - releasing beta versions and getting developers to build their own applications around it.

I see opportunities for new applications. If you are ready to release your Skype API application let me know.

While Skype founders are probably scrambling with what should be an overnight success, they are running some branding risks and have made some crucial target audience assumptions. Unfortunately, "beta" isn't an excuse. The consumers targeted with this product will ignore the "beta" label. I'm just going to put a few piece into play that suggests Skype must quickly become a marketing-centric organization.

Skype's consumer base is morphing by the hour. Each registration - will impact on the community that uses Skype. Living the Brand "Skype" requires more than the initial wow fun - it works. I will try and illustrate this. I'll be brutal. The founders of Kazaa, (an egocentric pitch if I ever heard one) bring you... That's a techno-centric pitch. Lets face it Kazaa created both the platform for this step and dangers particularly perceptions. Techies will take notice.. while my mother is not interested. Trading music - has a real economic incentive for young people. Kids do it. They can't afford CD's or would in fact rather put their money on other entertainment items. I think however the target for Skype is much broader. It's not 12 year old that are trying it out. Telephone calls have no cost for them. This big bold link to Kazaa is unnecessary. Get rid of it. There's a much bigger idea under it all and the founders must build real sympathy for it.

It begins with "living this brand" There's no marketer on the company list! There are already a number of branding problems. First we have (as too often with tech products) no consumer stories. The closest we get to smiling faces on the main screen are these two mug shots in the company section. Hey great they look like rock stars.... Well no. These photos in the company section are almost scary. They may want to change the world. However, that will require color and a smile. They must appear "pleasant" and "approachable". Some simply manufactured warmth would help. Change these photos quick!. They may work on Hot or Not; they aren't appropriate here.

It's true there is a lot of good word of mouth out there. I've been tracking it. People really seem to get it. So why start kicking at the founders? Simply because the best emerging online community I know for having a "personal" face is Adrian Scott's Ryze. From day one he cared about his friends. This is in stark contrast to the mistakes being made at Friendster. For Skype to be really successful it must be more than technology or "disrupting" the old phone system. It's about welcoming in tomorrow. We are in the age of P2P telephony. How people share in these riches will define the potency of the solution.

So what scares me about this initial beta techno incarnation is I (the consumer/customer) have no way of knowing if these guys care about anything more than the tech or the likely money they are going to make in the future. At the moment it could go either way. I'm talking about how names are filled in! I'm ranting about instructions on filling profiles. Profiles are central to this emerging community. I'm suggesting that the founders make it clear. I have have checked. THE FOUNDERS (full name) ARE UNLISTED! I can't call them. What sort of communications society are they suggesting we support? Are they scared to take calls? For this to really work... everyone has to want to be always on... like the phone system.

Now to be more fair... They won't be able to take millions of calls. Still an old computer with an away message would work. Or even have a PA answer some! Still there are many CEO's that can still list their home number. It's called the phone book. Here we have two founders that may well be able to create a P2P directory of everybody on earth. With some smarter technology it will enable progressive levels of disclosure. The path is fairly clear. So this... PERSONAL DISCLOSURE thing is important. They are not making it easy enough to decide.... what's my name and how do I share details about myself. The assumption is people know how to fill in the form. Actually they don't. Every community has it's approach. Just look at Ryze vs.. Tribe. ort Yahooprofile pages. Unfortunately the only Skype example on the home page lists Skype_lover and Skype_rocks as well as Catherine etc.. It's not funny and may suggest the wrong connotations. Just simply a risk a smart marketer wouldn't take in packaging a product for mass popular consumption. Clean it up quick! Share more thinking about the "design" of the profile. From my perspective some of it seems a little premature. My phone numbers??? Talk to me personally. Tell me how to be "smart", with-it and techno savvy.

This also reflects an issue of understanding who the target audience is. It's not those that change their IM name everyday on AIM. It is not your average Kazaa user. For a phone system to work we need some naming consistency. This is going to be a real interesting emergent phenomena. It is no wonder the Eula says... we can't handle emergency calls. By the way "Operator" is taken and is not listed. In some fun and jest I called up the top Brands
and started trying to register them as my number. Coca-Cola, Microsoft, down to number 7