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VIDEOSkype: It's Business Time
By
Scott Reeves Mar 23, 2009 10:50 am
New software to target corporate clients.
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The reason: Skype needs new sources of revenue.
Skype plans to announce a new version of its Internet software called Session Initiation Protocol, the Wall Street Journal reports. Limited testing is expected to begin today, and the service will be widely available later this year.
The new software will allow workers to make domestic and international calls using regular office telephones rather than a headset plugged into a personal computer. The charge will be about $0.02 per minute for calls to cellphones and landlines.
Use of standard telephone equipment may make Skype attractive to some corporate users and could put added pressure on Verizon (VZ) and AT&T (T) to cut costs.
Ebay (EBAY) acquired Skype in 2005 for about $2.6 billion in cash and stock. The service quickly developed a following among techies, because it allows users to make free voice and video calls using VoIP, or voice-over Internet protocol.
Skype says most of its customers are individuals, but about 35% use the service for business calls. The company hopes the new software will make the service more attractive to small- and medium-sized businesses.
Skype also plans to certify third parties to offer the services to businesses, but didn’t offer details, the Journal reports. This could be a crucial step, because few small businesses have the time or expertise to fret about Internet phone service.
It appears that eBay is under pressure to generate more revenue from Skype, or sell it. Last year, Skype generated about $550 million in revenue from calls to regular phone lines and from voicemail.
Skype was once a pioneer in the field, but the company’s new service will face competition from Microsoft (MSFT) and Google (GOOG). Microsoft provides software that connects phone calls (albeit creakily) through its Office Suite, and Google recently released an updated software package that enables users to link multiple phones to a single phone number and tap into voicemails online. There have also been rumors that Google might just buy Skype itself, since eBay has yet to optimize its investment in the service.
Skype’s service may come with indirect charges through required software updates. The service may be a good choice for tech-savvy users who can fiddle with needed changes, but here’s betting most users will be willing to pay a little extra to a traditional phone company in return for convenience. In short, the added (or perceived) hassle of using Skype may not be worth it to large numbers of potential customers.
There’s also a basic question that most non-techies can’t answer: Is Skype’s new service secure? The company says all is ducky; it notes that its new software is secure and that it has written tools to be sure all computers at a company use the same version of its new package.
Hello? What does that mean to the entrepreneur trying to make a buck?
No positions in stocks mentioned.
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