Skype and its friends are making it much easier to record chats, calls, and even video conversations. And folks like the Internet Archive and Google are making it easier to host and find those records. I just have to wonder how Ariyeh Yakov Mendel will feel at his bar mitzvah about
video of his circumcision being on the web for everyone to see. Kids are cute, but they are future teenagers, adults, job seekers, and candidates for office. Please, please be kind to the people they will become. [p.s. I'm not above using babies to make a point.]
I had an interesting discussion a few days ago. One of those rambling international ones with a fellow who like me has watched Skype from the beginning. I jotted a few notes down, ideas and points that were made or fleshed out.
Skype's new video challenge really highlights their current strategic crisis. With more than half a million Skypers playing around with various video solutions for Skype, it shows what even a nascent developer community can achieve quickly. Do the new video entrants suggest Skype rethink strategically their development attention?
Other companies are learning Skype is a perfect piggyback to success. Both vSkype and Video4Skype (now Video4IM) have "relationships" with investors in common with Skype. With well over 500K users trying these products in days of their launch it's clear that Skype users are willing to try new things. The value of the SkypeAPI just become even more attractive.
Concurrently we are seeing the first clues to problems Skype is having coping with developers. These video products are being developed often without any input from Skype at all. So with video, Skype has gone from working on their own video solutions to watching three other companies prototype increasingly sophisticated applications. In a well-managed developer world these would not be surprises. I have good reason to think they were.
Questions Raised by Video:
Should Skype be trying to develop their own video solution? Or should they be working with developers to enable better video solutions? Should they turn over what they have learned to developers so far....? Do they need control over video to have control over their platform strategy?
This feels like a prime opportunity to create a real developers platform. If they can only let go and think on a dime. Think Playstation. Video is the game equivalent. By contrast what video needs is 3D audio. Skype didn't invent their audio codec. However, they must find a way to keep their lead in voice. The rest of the VoIP market now understands that. Video without voice has limited appeal.
A more detailed look - starting with video examples.
1. The power an effective developer community could bring to Skype.
Example 1: First they had to beat Apple's Tiger version of iChat. Now they find themselves on the backfoot with other video programs enhancing the user experience. These new Skype video entrants aren't just small companies or one-man bands. Both Spontania and VSkype have real backing. By contrast it appears Skype has one key engineer working on video.
Example 2: Look2Skype developed an Outlook plug-in and separately, other developers have been working on them. Skype has hired and developed their own Outlook and IE solutions of which the Outlook plugin was released recently. From my perspective this hardly looks like a priority and just killed another developer's product that has been out there for months. In Peter Henning's post, he writes they went out to the developer community and bought the developer. These two products are more tactical than strategic.
So what should Skype develop internally? What should they enable developers to do? Their indecision traces to their lack of vision for their platform and where they want to draw the roadmap for developers.
2. The challenges and the integration needs to the GUI that are currently lacking in the API.
Example 1: VSkype added a tab and icon to the Skype Client. They are perfectly positioned so even when you move the client the buttons follow it around. Now it's not clear that vSkype has broken any rules or agreements in creating this solution. It does demonstrate that enhanced products will need greater access to the GUI. In the case of video it may even make sense for Skype to enable the competition so the best product wins. That's my observation on MT-plugins. A best one seems to emerge.
Example 2: The SkypeAPI exposes important information about others and not just yourselves. There is no negotiation with your buddies when you authorize each other. Thus, once you are a buddy I can do anything I want with the online status info you send me. The presence information is some of the most important social networking information available. Skype must create solutions for layered presence and aliases.
3. Time to question where development efforts are going and what priorities.
Example 1: Voice Mail. I recommended voice messaging. It took them months to change and recognize the positioning advantage. We shared Skypecasting and Skype is a major podcasting tool today. The VM solution hasn't adapted to the challenge or the opportunity. By contrast, Steve Jobs is organizing Podcasting in iTunes and the bloggers etc love it. Gizmo launched and many told me they would switch for voice mail. When it comes to viral marketing the blogosphere would be all over Podcasting enhancements to Skype. By contrast an Outlook solution is a yawn.
Example 2: Voice Mail. I should get a copy. I should be able to apply a topic to voice messages, I should be able to confirm that I want to send. I should be able to forward messages under certain conditions. Etc. Zero progress since voice mail launched.
Example 3: Recent focus groups were held in both Silicon Valley and London. Focus groups aren't necessarily the best way to find out where to go next. Still some of the questions that were asked were intriguing. They included payment for ringtones, extended conference calling and some form of premium member status. These two provide an example of what I believe is shallow thinking, not probing where the real future value is likely to be. I have no reason to believe they asked about voice messaging, or podcasting etc. Ringtones shows a particularly short-sighted vision. Now play ringtones with iTunes - that's an idea.
Example 4: Billing and accounting. Not only needs work, it need solutions so developers can create programs that can use it as a back-end payment system. Every mobile phone co in the world wants to be your wallet. If Skype would work with the developers it could have more than half a chance.
Example 5: While "grouping" features are bound to come in the buddylist, they aren't likely to solve the need for 'alias', layering in identity and improved gradations in presence management. Similarly developers can't push the right data into Skype. For example when will Skype accept location data from me and represent it in my presence information?
New Threats are Emerging. Three examples that could change the playing field.
Example 1: RSSosphere. RSS and related XML solutions are radically changing how we gather information and how it is delivered. The real time nature means this will impact on IM / Text and Chat Systems. IM systems have not innovated. With voice currently stuck on a new plateau reinventing the real time infomation flow could get people moving again.
Example 2: Mobility Integration: Presence systems need enhancing. Location information is critical for effective networking. Dodgeball is just one example Opening the API to accept location information would be a big step forward.
Example 3: Voice Activation. Skype with their centralized contact list has a huge opportunity to provide a voice activated dialing system that would automatically update to mobiles etc. Concurrently voice authentication software can confirm the caller is who they say they are in the first x seconds of the call.
Example 4: Skype Profile information is already being used in new API related programs. The opportunity to port information into other programs by and under the control of users is just beginning to be understood. vCard enhancements are good. Profiles should become a "larger" development item and get the voice feature built in. These are game changers.
Strategically there are some obvious successes not leveraged.
This started out with a video example. Then it becomes clear there are many competing strategic interests. As the complexity increases it become more difficult for developers to understand their safe bets and how they may make money. There are good reasons for Skype to integrate video into the client --- and that should be another post. I do hope Skype is looking closely at Spontania as they have some very neat mobile technology emerging.
These points are rasied not because Skype should dictate or layout their full roadmap. Rather the dialogue should be with the developer community. If Skype really wants to harness "our" energies then they simply have to let "us" in.
This is Part One of a series of tips and tricks to achieving the ultimate video experience.

Three simple rules:
Next in this series: Choosing a Camera.
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:
Here is what Tim had to say...
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?
What are the challenges for Skype in Asia?
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?
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?
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?
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?
The Skype Software Development Community
How important is a third-party development community to Skype and the Skype users?
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?
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?
###
So begins the Skype Video War. What a cool arms race. There are three groups in the race. The IM people upgrading audio and video (AOL, MSN and Yahoo!), the Skype third party developers, and Skype itself.
Two weeks ago the story was Spontania’s Video4Skype release. Now Santa Cruz Networks realeases vSkype. This means the 40 million Skype users have these features, and Microsoft, AOL, and Yahoo don't. CEO Stuart Jacobson says, "vSkype adds two cool new experiences to a Skype user: multi-user video and desktop sharing."
The screen shot below says more than my words can. It is an international conference I hosted from Kelowna, B.C. to: Opole, Poland, Toronto, Canada, Jackson Hole, Wyoming, USA, Sweden, and Bucharest, Romania.

I have been playing with and testing a pre-beta release of vSkype. It has been a thrilling week. Thank you Santa Cruz Networks ─SCN─ people for the opportunity and for putting up with all my whining and nagging.
Now I get to share with our Skype Journal readers the fascinating story of a development team who in eight weeks went from strategy to product deployment in the market. I’ll cover the product, the company, the cool features I like, test results and interviews with CEO Stuart Jacobson and CTO Barry Spencer.
This should look like a familiar process to any Skype user who has added a contact to a Chat.

A Skype chat message with a conference link is sent to all those invited.
Tip: In fact it would be a good idea to create a persistent chat for all the participants.
One click and you add another buddy to video conference as shown in this video conference session: France, USA, Poland, Sweden, and Canada.

"We’re a group of battle-scarred veterans", says Santa Cruz Networks developer, Bernie Vachon, ex-Borland like 3 of his work mates and also an ex-Canadian from my neck of the woods. Interesting contrast to the younger demographics at Skype. CTO Barry Spencer, who has his hands around the core video technology, tells me, "I was employee number 23 in Lotus just ahead of Jim Manzi".
When asked what he brings to the table, Itzik Cohen, VP of Marketing and Business Development explains it to me this way,
"I am a 6 foot 9 former Israeli pro basketball player who was employee # 38 at WebEx. Video is the hardest thing to do on IP. I want to do what Skype did for video- just make it usable. The future is no more blind dates. We have a lot of interesting technology to make video a fun experience… eye candy, backdrops, gaming. We have a great leader in Stuart, who brings incredible wealth of experience and a calming influence, along with strong investor/board members like Tim Draper of Draper Fisher Jurvetson and Robert Troy (Geneva Venture Partners). vSkype is just our first plug-in. We plan to release plug-ins for every major presence network out there. We have a consumer strategy and a strategy for business grade services."
These SCN guys feel like seasoned players!

Start > All Programs > vSkype as shown here View image. The result is shown here View imageI like to test 4 key performance indicators. In the end you the user will decide what you like best. These tests are so our beta testing group doesn't end up deadlocked like the UN. Opinion doesn't count in this court. Nor do fancy PowerPoints.
vSkype performed remarkably well. CPU utilization was between 5 and 10 percent.
Resolution even in a 5 party video conference call was better than 300 lines per inch View image (that's really good) and it did as well as Video4Skype on the eye chart test with viewers in a conference being able to read 12 point type.
Fluidity was just okay. Fluidity is the ability to move your head or hands without any jerkiness in the video. Finger test counts were behind by one finger (about half a sceond) so lip sync was not as good as I would like to see it.
Bandwidth consumption is difficult for me to rate. SCN use a neat technique called elastic bandwidth (that Barry Spencer is a clever fellow). vSkype uses all the bandwidth you have available which makes for a great video experience, but it makes it really difficult for us beta testers to do comparitive testing! All I can say is if you want a good video experience get a broadband connection with more than 128 kbs upload speed if you can.
Tell me about your corporate culture. You seem to be an older lot. How does your demographics compare to others in the valley?Barry and I are a bit older but our average age is late 20 and early 30s. I am happy that you didn’t comment about our maturity vs. age. Although we are twice retired and living in Santa Cruz, we are still having fun!
Do you mean the Silicon Valley or the San Joachim Valley? The valley is multi-ethnic and so are we. We even have a Canadian on our team. We speak 8 languages among us. I have lived in India, China and Marin County. Itzik used to play pro basketball in Europe before a great run at Webex. He has lived in France and Israel. Jean-Marc was born in Paris and speaks with a real Parisian Accent. Alex is from Mexico. Our lead engineer, Jeremy lives here and in Russia. At the moment he is on vacation with his family in Germany – which is why you are seeing so much of Barry! We re as diverse as the valley!
What are the advantages of having a team of old guys vs 13 15 to 20 year olds?
Older guys don’t make as many mistakes. More important, they actually understand how computers work. Video is hard to do and still taxes processors. To make is work on the internet were bandwidth varies, and to make it work in more that just a P2P configuration, you have really understand how to manage resources and optimize instructions. Most programmers today use Java or VB. They don’t worry about overhead and do not have to know, nor can they know, what is really going on. Older guys learned how machines really work and know how to manage and optimize with scarce resources. We like to team experience and wisdom with energy and enthusiasm!
Why did Stuart Join SCN? Who found who? What unique things do you bring to the table? What gaps do you fill?
Communication is good for us all and can be a very profitable business. I joined because I think it is time to use the internet to help people communicate more often and in more ways and because there is a huge opportunity to win big. I was originally introduced to SCN by Joe Costello, our board member. Joe sat on the Saba Board. Recently I was also reacquainted with Robert Troy from Geneva Venture Partners. Geneva and Robert were involved early on with Oracle while I was their and funded old colleagues of mine who built the CRM business (Seibel and Salesforce).
Is an IPO on your radar screen?
No. I have been through 3 IPOs. Even if the market were right, my answer would be the same because it is not the right time to think about an IPO. At this point we are focused on building a great user experience, making real-time communications fun, finding interesting ways to encourage its usage in group settings, and making money.
From a Skype Plug-in perspective who is your end user?
That is a good question! One of the reasons we are releasing our product in beta is to better understand this. The Skype community is vast and wonderfully diverse. We are learning as we go along. Our colleagues over the hill in Silicon Valley are interested in using the plug-in to manage their outsourcing partnerships and clients in India and China. We have also had interest from various religious and special interest groups interested in everything from motorcycles to politics. We have also had interest from tutors and educators, especially those focused on teaching language. They all want to meet on line and in groups.
Are you a video conferencing tool, a collaboration tool or a content producing tool?
As you know, we have a large library of content and camera games that we intend to leverage with vSkype. We know that allowing users to play group camera games will be a hit in the Skype community. Our tools for conferencing are fairly complete and we think they will also be useful to Skype users. Collaboration is a big word and an industry on its own, our collaboration is light but useful.
At heart, we are a technology developer and our strategy is to enable our partners and their customers to utilize our tools to have fun, make money, and improve their customer satisfaction. If we do this well, we will make lots of money.
Did you know Tim Draper personally before you came to SCN?
No.
What is your vision for SCN at the end of 2006?
Our vision: People will come together on the internet and use it to communicate more and in different ways. As the internet becomes unwired, opportunity to communicate and share will grow. We want to be a core enabling technology provider facilitating this.
By the end of 2006 we believe that millions of users on all of the presence networks throughout the world will be using our products to communicate visually, meet in groups, play games online, and show their friends what they are doing right now!
When will you move to a P2P architecture like MSN did and like what Spontania have?We already have P2P running. It will be an option included in our production release. We decided to start with the hard stuff first (a server solution that supports both one-to-one and large groups) and offer users a broader range of services – many of which can only be delivered using a server architecture. Once we determine how it is being used, we will optimize our P2P solution.
What are the advantages of P2P?
Performance may be faster with computers that are geographically close in a P2P environment. There also is no bandwidth cost, but this cost is dropping radically. The advantages of a server based solution are many and include groups, security, scalability, reliability, and better support and management in corporate environments (e.g. bandwidth control, firewalls, NATs, etc), There are also additional features that can be offered like centralized archiving, video mail, and games.
What is unique about your technology? Why did you build your own codec? There are some really good ones on the Market like the VP6 TrueMotion.
Our technology was designed to support groups and other add-on services such as sharing. Our technology has built-in QOS for the Internet; it constantly adapts to fluctuating bandwidth and prioritizes multiplexed data accordingly. It also provides centralized bandwidth control for shared connections. Our multipoint architecture allows us to cheaply scale to support large groups of up to 200 per call. Designed specifically for the Internet, our solution securely goes through firewalls, NATs and proxies.
How will 3rd party video plug-ins compete with Skype video? Will the war end before Skype announces their free video? Who knows? who cares?
For us Skypers the vSkype beta is on their web site. Go play. Get thrilled, as I did, by a new Skype experience.
I suggested a bunch of video features that I wanted. A dozen of you took the survey
to pick the top ones. Here they are, with a tie for second place and a three-way tie for fourth.
Of these six, two bring other tools into Skype calls, and four help you overcome real life communication challenges.
Skype's Strategy - Crisis Looming?
The Ultimate Skype Video Experience Part 1
Tim Draper the proud "father" of Skype and vSkype