Melbourne Herald Sun, Friday May 20, 2011
My family is widely scattered. My mum's in Italy, while there's a daughter in Berlin and a son in Shanghai. So I discovered Skype pretty early, soon after they started in 2003.
This wonderful internet phone service allowed me to talk to my kids, computer to computer, for free. At a time when the phone services were charging 50 cents a minute.
These days the service connects with 170 million users and offers teleconferencing, video calls, text messages and much more. All for free or for very low cost compared to the carriers.
But free calls don't mean no value. Last week Skype was sold to Microsoft for eight billion dollars.
This completes a remarkable world circuit. The program was devised in Tallinn, Estonia, of all unlikely places. The developers sold it after two years for $3.6 billion to eBay (not a bad return for two years' work, I remarked at the time).
But they weren't the only sharp boys around. In 2009, after eBay had lost considerable money on the deal, they happily sold two thirds of the company to venture capitalists Silver Lake and the likes of Andreessen Horowitz (remember Netscape?) for a mere $2 billion.
Now, another two years on, lay down the royal flush. Silver Lake clinched the deal for $8 billion. An even better profit for two years' work. Boy, how money flows when you're in the right place.
So what are Microsoft going to do with it? For a start, Skype came with massive losses, it has never made money. That's always a problem when you give your service away for free.
Oh sure, some of their products are paid for, like Skypeout which allows users to connect with actual land lines or mobiles anywhere in the world. But these were never enough to wipe out the huge losses. As it was, it came with $600 million debt.
Of course to Microsoft this is just peanuts when their objective is elephants.
They are aiming primarily at Google, which they see as their biggest threat. Google has been adding services at a dizzying speed. The mobile phone system Android is a direct competitor with the Windows 7 mobile phone. Google Chrome is building against Internet Explorer.
But with Skype, Microsoft can now compete with Google Video and Voice. Both sides will be hard at work building up their capacities.
The most sensible thing eBay did was to leave Skype to its own devices. Under the corporate umbrella, but without the corporate straitjacket, Skype flourished and developed its huge range of services and cloud farms.
Microsoft boss Steve Ballmer says he plans to connect Skype to Microsoft's Outlook e-mail, Xbox game console, Windows mobile phones and corporate-phone software. But will he allow his new Skype division the freedom it needs to flourish, or will it be smothered in the Redmond embrace?
At the press conference announcing Microsoft's biggest ever takeover bite, CEO Steve Ballmer went out of his way to promise that Skype will continue to support non-Microsoft platforms and operate as a separate Microsoft division.
Well will it? We can expect to see a longer-term objective with Microsoft making serious competition with the likes of Cisco, AT&T and locally, Telstra. These are much deeper waters than the Skype team has ever fished in. They are going to need all of their parent's muscle and resources to stay afloat.
Which of course leaves the question, how long can Skype continue to be free? Forever, we hope - but I don't know how much I'd bet on it. Somehow the bean counters will want to see some repayment of that eight billion bucks - and a hefty profit on top.
Blog: themarketeer-raybeatty.blogspot.com
Showing posts with label Skype. Show all posts
Showing posts with label Skype. Show all posts
19 December, 2009
Has the internet killed the Christmas card?
Melbourne Herald Sun, 19th December 2009
The other day I heard a comment in trendy Albert Park. Two mid-30s yummy mummies catching up over their soy lattes. “I just haven’t had a minute to send out the Christmas cards this year.” “Same here - it’s going to be emails again like last year.” They nodded in agreement.
Eavesdropping from the next table, my reaction was: “Thank goodness - I’m not the only one.” Yes I’m afraid my friends and extended family - as opposed to immediate family who have been carded and gifted already - will receive their warm, heartfelt greetings. But without the postage stamp.
Over this decade, as the internet has grown from strength to strength, the world has seen a decline in Christmas cards.
In Britain the number of festive cards bought in shops has dropped by 20 million in the past two years. Even more worrying, a recent survey showed that 40 per cent of the under-35s have given up the card habit.
In America the number of Christmas cards received in the average home dropped from 29 in 1987, to 20 in 2004. Latest figures indicate that the decline is continuing.
The ever-sunny Australia Post PR machine assures us that in fact nothing has changed. Just a few weeks age they announced that AP expects to deliver 470 million mail articles across Australia, up from 450 million in 2006. But are they Christmas cards I wonder? They are certainly not coming to my letter box, how about yours?
The post office and Christmas cards have always been linked. The first commercial cards were produced in London in 1843 by Sir Henry Cole - one of the creators of the Penny Post three years earlier, the foundation of all the world’s postal services.
For a century and a half the cards flourished as a form of social massage for the human family. Even if you only met with your cousin once every ten years, you could be guaranteed to exchange cards every Christmas. It said “I know you’re there and I still care for you”.
Modern communications have changed all that. Your cousin knows you are here because every few weeks you share a dirty joke with him and your friends in your emails. Girls now have cordless and mobile phones so they can have long chats with their girlfriends while they make the beds or cook the dinner (how does my wife do that? I am in wonder at her multi-skilling). And Skype means that even interstate or overseas friends can stay in the circle for a low cost.
In Britain again, they estimate that email cards are growing by 200 per cent a year. There are now thousands of card services on line which allow you to email all your friends and customers, and others that will produce and individualise cards from your mailing list, with your message, and send out the cards in the mail.
Of course all the Scrooges have lots of good excuses. Cards are too expensive, postage is exorbitant, a postal strike could stop them arriving, they are environmentally damaging both in production and disposal, and who has got time between job and home and kids and preparing for Christmas - to sit down and write cards?
But there is something a little sad about a barren dresser with just a few cards from your parents and aged aunts to show it is Christmas.
Well let me take this opportunity to thank you, my loyal reader, for sticking with me all year. This is my Christmas card to you, if you wish you may clip it out and place it on the mantlepiece. And do have a VERY MERRY CHRISTMAS! Cheers - Ray.
Ray@ebeatty.com
The other day I heard a comment in trendy Albert Park. Two mid-30s yummy mummies catching up over their soy lattes. “I just haven’t had a minute to send out the Christmas cards this year.” “Same here - it’s going to be emails again like last year.” They nodded in agreement.
Eavesdropping from the next table, my reaction was: “Thank goodness - I’m not the only one.” Yes I’m afraid my friends and extended family - as opposed to immediate family who have been carded and gifted already - will receive their warm, heartfelt greetings. But without the postage stamp.
Over this decade, as the internet has grown from strength to strength, the world has seen a decline in Christmas cards.
In Britain the number of festive cards bought in shops has dropped by 20 million in the past two years. Even more worrying, a recent survey showed that 40 per cent of the under-35s have given up the card habit.
In America the number of Christmas cards received in the average home dropped from 29 in 1987, to 20 in 2004. Latest figures indicate that the decline is continuing.
The ever-sunny Australia Post PR machine assures us that in fact nothing has changed. Just a few weeks age they announced that AP expects to deliver 470 million mail articles across Australia, up from 450 million in 2006. But are they Christmas cards I wonder? They are certainly not coming to my letter box, how about yours?
The post office and Christmas cards have always been linked. The first commercial cards were produced in London in 1843 by Sir Henry Cole - one of the creators of the Penny Post three years earlier, the foundation of all the world’s postal services.
For a century and a half the cards flourished as a form of social massage for the human family. Even if you only met with your cousin once every ten years, you could be guaranteed to exchange cards every Christmas. It said “I know you’re there and I still care for you”.
Modern communications have changed all that. Your cousin knows you are here because every few weeks you share a dirty joke with him and your friends in your emails. Girls now have cordless and mobile phones so they can have long chats with their girlfriends while they make the beds or cook the dinner (how does my wife do that? I am in wonder at her multi-skilling). And Skype means that even interstate or overseas friends can stay in the circle for a low cost.
In Britain again, they estimate that email cards are growing by 200 per cent a year. There are now thousands of card services on line which allow you to email all your friends and customers, and others that will produce and individualise cards from your mailing list, with your message, and send out the cards in the mail.
Of course all the Scrooges have lots of good excuses. Cards are too expensive, postage is exorbitant, a postal strike could stop them arriving, they are environmentally damaging both in production and disposal, and who has got time between job and home and kids and preparing for Christmas - to sit down and write cards?
But there is something a little sad about a barren dresser with just a few cards from your parents and aged aunts to show it is Christmas.
Well let me take this opportunity to thank you, my loyal reader, for sticking with me all year. This is my Christmas card to you, if you wish you may clip it out and place it on the mantlepiece. And do have a VERY MERRY CHRISTMAS! Cheers - Ray.
Ray@ebeatty.com
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