The Elephant In The Room

[Astrosmurfer]

I've recently noticed an Elephant in the room and I'd like to throw it out for discussion to see what others might be thinking.

The elephant's name is Skype. It seems to me that Skype has become a huge telecom beast with the technology, user base, and possibly funding to totally disrupt global telecommunications and frankly turn Asterisk/PBX In A Flash into a cinder.

Skype has a super easy to use and accessible to everyone, free audio and video telecommunications service. It also has the technological underpinnings to make it work very well, even where other standard technologies fail. Yet, strangely, Skype remains a somewhat niche player in the telecom world. Why?

Certainly, at the consumer level, Skype already threatens the world's telecom giants. Who knows how many millions of consumer minutes/dollars the likes of AT&T have already lost to Skype? Only they know for sure but, the fact that they have acknowledged, grudgingly, that Skype is a legitimate competitor that they must strategize against speaks volumes. At the consumer level, Skype is still only taking a small percentage of the market but it is slowly growing.

What's holding Skype back in the consumer market? Mobility. Until very recently, (free)Skype was tied to your desktop PC but, most of the consumer market was gravitating to mobile phones. Recently, Skype has made clients available on certain smart phones and has also released an SDK for third party developers to produce their own Skype clients.

Smart phone clients mean that (free)Skype audio and, to a lesser extent, video are now possible on mobile phones. As the adoption of smart phones grows, surely Skype's penetration in this space will too. Further eroding the minutes market of the telcos, both mobile and long distance.

Skype has been a much lesser contender in the business space, specifically against the PBX and the PRI. Why would that be? There are a few reasons for this, mostly technical.

The first reason is lack of features. With Skype, businesses would lose mutliline and call flow features that they presently enjoy. As well, they would lose the application integration options that a PBX currently affords them. That's a big deal.

Another issue with Skype in businessd is bandwidth and availability. Corporate bandwidth suffers when they have numerous Skype clients all sharing their bandwidth with the world, even when no calls are in progress. Additionally, if the internet connect fails or the Skype registration servers have an issue, the business loses all telecommunications both external and internal.

Of course, these issues could easily be mitigated by a small change in the way Skype works. Skype has only to create the "corporate super node" that acts as the central server for corporate Skype operations aggregating and streamlining bandwidth usage, as the standard PBX does today. Throw in a few features to allow call flow manipulation, application integration and what have you and you've got a major threat to the way business has handled telecommunications for the past few decades.

In my view, Skype need only take an open source PBX with all the desired features like Asterisk or FreeSwitch, merge in the Skype audio, video and transport technology with a matching client SDK. They then become an imminent threat to not just all the PBX makers out there but also to every telecom company in the world.

Do we need AT&T or Orange when there is Skype on every mobile and Skype phones on every corporate desktop? It seems to me that the elephant in the room is growing rapidly.

Now some will argue that all this free talk is rubbish. World doesn't operate on free and Skype can't survive if all the world is using the free service. But, if everyone is using Skype and Skype charges a penny per call, connection charge; how many billions per month would they bank for little or no cost?

Others will argue that the switch from "PSTN" or more traditional telephony to Skype would be too disruptive to ever happen. But, that was the same thing they said about SIP ten years ago and look where it is now. Today, even those that do not think they are using SIP at all are having their calls routed across the carrier's SIP backbones.

In my view, Skype has the opportunity and potential to put all of today's telecom stalwarts out of business in an "instant". My only questions are if and when will they execute? What are your thoughts?

 

[sunshinenetworks]

There is ofcourse "Skype for Asterisk" and the other, much bigger elephant in the room, called Google Voice. Google Voice offers free calls to anywhere in the USA and Canada, and it won't be long before Google Voice means free calls to anywhere in the world. Probably Skype will offer free communications to the world at some point ( to both normal PSTN lines and other skype accounts, like Google Voice already does in USA and Canada ).

Both GV and Skype are supported by Asterisk, as a trunk. So rather than Asterisk losing ground, I see Asterisk gaining ground vs the telco's who don't have a means to connect to either of these services yet. Telco's will end up offering only mobile services, and those might become free also , with perhaps paid SMS and paid TV and other services, but calls will be free.

There's a lot of movement in the telco world at the moment, and things could go any way. With ADSL companies making VoIP pretty much standard nowadays, it won't be long before there are more VoIP connections than PSTN connections, and from there it's an exponential VoIP growth to the point that having a PSTN line is comparable to having an old black and white TV vs the modern LCD screens.

 

[blanchae]

If you do a search on ebay, you'll see that there is quite a few "VoIP" style phones that are made for use with Skype. From desktop phones that mimic a VoIP phones to wireless handsets, ATAs and USB handsets. My favorite is the USB optical mouse that transforms into a Skype phone. It's something that the manufacturer's are jumping on. If you want to see the latest tech, search ebay as that's become the trial market.

 

[Lavarock7]

FWIW, I heard recently that more cellphone users are texting than making calls. Also realize that text messages are free for the cell phone companies yet a giant profit center for them.

 

[Astrosmurfer]

A brief off topic note.

Also realize that text messages are free for the cell phone companies yet a giant profit center for them.

This is a common misconception that is increasingly being bandied about. While it is true that the per message cost of SMS messaging to the carrier is VERY low, there is indeed a cost that must be paid by the carrier. As well as the obvious costs for infrastructure build-out and maintenance, there are additional costs. One such cost that is a significant percentage of the cost is accounting and settlement.

Many carriers actually contract third parties to settle charges for intra-carrier SMS messaging. This company is one such example of many. Naturally, the settlement companies charge a fee for this service. Money changes hands and the world goes round.

But, you are correct, text messaging can be a huge profit center for most carriers.