Where Next Skype?

September 25, 2003

in Accelerating Innovation

This post covers where we are going next with Skype. My underlying belief that this is radical innovation and that managers must understand networks to be successful. I plan on using my blog as a good way to test these ideas with a live emerging case study that we are all involved in. Particularly for Skype connected bloggers there is a range of insight we can each individually and collectively bring to this.

Last nights small Skype dinner was a blast. We covered a lot of ground and there’s more still to cover. You see I came away believing I’m not alone in thinking Skype may be a really big thing. More importantly with the whole VoIP space hotting up (don’t believe me then just go to Google News and subscribe to VoIP and Skype respectively) it is worth considering alternate scenarios. From Microsoft to SBC, Motorola, Nokia and Dell, not to mention AOL and Yahoo, I hope to hell their management teams have this on their radar and it’s not a surprise.

Skype represents Radical Innovation:

Some of you may wonder why I’m still running with the Skype story. It’s frankly a great space. This is the intersection of marketing, innovation and strategy that I most successfully facilitate and implement…. The product pricing opportunities are intriguing while new functionalities can potentially redefine how we “phone”. Then there are the peripheral businesses and particularly hardware innovations that will be coming. That will be a change as yesterdays phones and innovation are an oxymoron.

P2P Networks – Connectivity, Flow & Sharing
I’ve been a believer for four years that this was coming. This may be more than just another early warning indicator. Skype is also more. It presents a point in time where the opportunity to test thinking around topics from social networking, IM tools, to the future of email and telephony, and the internet itself. The impact is much broader as well. This is a software company. It is an intellectual asset backed by I bet a very few people that is potentially reconfiguring economic structures. How we connect impacts on how and where money is made. This may just be an example of tomorrow’s company. Just like Ryze is an example of one pioneer creating a community for 50000, a few are creating real value here. It is also Creative Distruction. Simultaneously, I am seeing numbers that say currently 10% of all voice calls are VoIP. What’s the potential for Skype? Possibly as a program it could approach as much as 10% of Windows revenues. Broker some relationships with the Telco’s and it could be more. Negotiating with the telco’s alone will be interesting.

Emerging Topic areas.
So where do we go with this? Our brainstorming session lead in many directions last night. We’re both going to keep blogging about Skype. Here’s the list I organized. Phil’s separately blogged his perspective.

  • Consumer Behavior From Beginning Calls to Managing Friends and Answering.
  • Experimenting with Skype: Skype Basic and Skype Pro Features
  • Defining the Business Model and Profit Opportunities for the Skype Garden
  • Defining Personal and Business Pricing Structures
  • Functionalities and Things Skype Needs to Address
  • Blogging with Skype
  • Amazon / EBay n’ Skype
  • The Conferencing Opportunity.
  • Story to Close and Comment:
    I wonder how many of you have had your first experience of Skype with a full headset? For the simple observation is that phones only use one ear while Skype profits from two.., People really get into your head in stereo. No wonder the sounds so good! We laughed so hard on this observation.

    Then again if Skype were the size of Kazaa in two years time… with approximately 250m users and say 100m online at anyone time, I’d guess that would make them the largest telephone system on earth. It creates a different sort of negotiating position.

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