Smartphones cannibalize Skype's own market

Skype's own success may lead them to cannibalize their own paid call revenue stream. Here's why.

Skype's own success may lead them to cannibalize their own paid call revenue stream. Here's why.

Ever since its inception, Skype and other VoIP applications have long been healed to the end of telco dominance of long distance and overseas calling. Utilizing the internet instead of traditional methods of routing your call, Skype can offer much lower calling rates, or even free PC-to-PC calls, striking fear into the hearts of every telecommunications company.

Skype's success has only increased as we moved away from dial-up internet into cheap availability of broadband, removing the last barrier to crystal clear calls. This period saw the emergence of Skype handsets, making Skype a permanent, non-PC experience for the first time - going as far as to replace the land line for some.

With the widespread availability of 3G mobile internet, the immense number of smartphones being sold with Skype being a downloadable app, as the deep integration of Skype into Windows Phone 8, the company's technology is now literally accessible by anyone, anywhere. Within a few years, smartphones are expected to overtake the sales of feature phones, meaning that smartphones will become the new normal.

Ironically, Skype's own success may lead to them cannibalizing their own market. With the ubiquity of smartphones with Skype, their paid user base may shrink: those who buy Skype credit to call traditional land and mobile phones. If you and your friend both have Skype enabled smartphones, which are now mostly always-on, and they can be used to make free calls via the internet (VoIP), why would any of you need to buy credit again?

One of the ways that Skype is looking to increase revenues is the development of "Conversations Ads", which is a marketing-spin on normal square ads during audit conversations. Skype probably has figured out that during a Skype call, they pretty much have a captive audience, and hope to captivate callers into discussing or clicking on their ads.

Will this be enough to off-set the inevitable decrease in paid calling, as a result of cannibalization? Ads have served Google well, and it may just be enough to keep Skype going.



5-why,10,advertising,8,amazon,4,analysis,14,anime,4,apple,1,aria,1,articles,15,asian business culture,7,Australia,6,bangkok,21,blackberry,6,business,16,case study,4,china,3,coaching,3,commentary,8,communication,3,consulting,2,corruption,1,cost cutting,1,creative commons,2,crisis,2,CSR,2,culture,7,customer,1,customer service,4,deming,1,disruption,2,disruptive,2,download,12,editorial,51,education,2,entrepreneurship,8,environment,2,ergonomic keyboards,2,ethics,2,expatriate,1,fishbone diagram,2,food,2,genchi genbutsu,2,generation y,2,hansei,1,harvard business review,2,hong kong,7,Horenso,5,information,1,innovation,14,instant noodles,1,interesting clips,6,internet,2,iphone,3,IT Audit,2,japan,15,kaizen,30,korea,2,KPS Video Express,3,laos,4,leadership,7,lean,5,live in bangkok like a local,4,management,17,marketing,29,Melbourne,5,mieruka,11,movie,1,new year,5,obituary,2,opinion,37,opportunity,7,PDCA,11,personal reflections,5,photo essay,1,photo walk,1,photography,15,poster,1,project management,1,proposal,1,published,6,quality control,4,quotes,7,research,1,review,6,sales,2,security,1,segmentation,1,self reflection,1,shared,1,singapore,3,software piracy,2,standard chartered,1,status,1,teaching,1,technology,21,telecoms,8,thai floods,12,thailand,27,The Toyota Way,43,thought leadership,3,threat,1,toyota,9,toyota production system,42,travel,11,vantage point,1,venice,1,Visuals,13,wallchart,1,wikicommons,1,Wikipedia,2,working,1,zarticles,32,
K Bulsuk: Full Speed Ahead: Smartphones cannibalize Skype's own market
Smartphones cannibalize Skype's own market
K Bulsuk: Full Speed Ahead
All posts loaded No posts found VIEW ALL Read more Reply Cancel reply Delete By Home PAGES POSTS View All RECOMMENDED FOR YOU LABEL ARCHIVE SEARCH ALL POSTS No posts found Home Sunday Monday Tuesday Wednesday Thursday Friday Saturday Sun Mon Tue Wed Thu Fri Sat January February March April May June July August September October November December Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Just now 1 minute ago $$1$$ minutes ago 1 hour ago $$1$$ hours ago Yesterday $$1$$ days ago $$1$$ weeks ago more than 5 weeks ago Followers Follow THIS CONTENT IS LOCKED STEP 1: Share to a social network STEP 2: Click the link on your social network Copy All Code Select All Code All codes were copied to your clipboard Can not copy the codes / texts, please press [CTRL]+[C] (or CMD+C with Mac) to copy Table of Content