Fear the Skype

Mobile VoIP players need to realize they have one big problem - Skype. And if you're going to take a shot at the King, you'd better not miss.

Skype has four things going for it in the battle of the mobile handsets: 1) healthy cash-flow, 2) established brand, 3) experience, and 4) a long-term strategic vision. Skype is bringing in around $500 million a year - serious coin. The company has cut deals to get its brand put on everything from super-cheap plug-in phones to a dedicated Skype phone by 3, so people know them by name.

Cutting all the deals and being around for so long relative to the "new guys" means that company staff and executives know a lot about what works and what doesn't work in the mobile field. When Skype releases a Lite version, people expect it to work due to the company's established brand and its experience in implementing its software on a variety of platforms.

A lot of people got worked up when Skype declared that "VoIP is dead." Consumer PC-platform voice is certainly mature to the company, so it needs to more toys, er, features to continue to expand market share, so video is definitely the new poster child. It's not a far stretch to see a "Skype" button on a large screen HDTV remote next year, with the TV having built in two-way audio and a video camera.

If "Skype everywhere" is one part of the long-term strategic vision, a more expansive presence into the business world is another part of the game plan. Business is where the money is at and Skype is hiring in a down economy. Care to speculate how they'll be doing at the end of 2009 relative to most of the venture-funded mobile VoIP me-toos?

Finally, Skype is not afraid to mix it up in the political arena. It has its own dedicated set of lobbyists making the rounds of Capitol Hill and other policy-making centers around the world. Two weeks ago, Skype President Josh Silverman was in Washington speaking at an event put on by the Advisory Committee to the Congressional Internet Caucus. Silverman got face time with lawmakers and staffers to make sure people know what Skype's views are on net neutrality, wireless openness, the universal service fund, E-911 and national broadband policy. I suspect Congressional staffers associate mig33 with the Russian airplane.

- Doug