![]() ![]() ![]() But a low-bandwidth connection or Net congestion can reduce the sound to the fringes of audibility. In terms of pure audio quality, Skype-to-Skype direct calls can sometimes sound better than landline calls and far better than the noisy compressions of many mobile conversations. Because Skype sounds travel over the Internet, they generally involve a small but perceptible time lag, which can have a disconcerting effect on a conversation if you're not used to it-as though the person you're talking with is emotionally distant or confused. The only significant downside of Skype is the audio quality. Right now, Skype charges $50 a year for a SkypeIn number. Skype users can also pay to establish a "SkypeIn" number that can be dialed directly from traditional phones, which means that if you switch to Skype as your permanent number, you don't have to teach your grandparents how to install the Skype software on their computer-assuming they have a computer. The calls are billed at rates that tend to be cheaper than the rates for traditional service, although they vary depending on the country being called. It's exactly the same rate to dial your next-door neighbor that it is to dial someone 10,000 miles away: zero cents per minute.Ĭost enters the picture when a user wants to call someone with a traditional phone number, for either a landline or a cell phone. ![]() If you're calling other Skype users-no matter where they happen to be-the calls are free. You download software from the Skype servers, and assuming you have a headset or a microphone and speakers attached to your computer, you can immediately start calling people. This is the kind of thing that keeps phone company execs awake at night, but there is no question of intellectual property being stolen.įrom the users' perspective, Skype is refreshingly simple. ![]() Instead of using his software to download free songs, people use it to place a voice telephone call to someone on the other side of the planet-free. Zennström's vision with Skype was to take the power of peer-to-peer networking and apply it to a field without significant intellectual property issues. (It has also triggered more than a few lawsuits.) In fact, Zennström's previous software effort was a wildly popular peer-to-peer application called KaZaA, which has been used to share millions of files over the past few years. Skype is built on the same sort of peer-to-peer networking technology that powered many notorious-and, depending on whom you talk to, illegal-file-sharing services, starting with Napster. Skype's dearth of paying customers is easy to scoff at, but the foundation of the company is far more solid-and interesting-than the irrational exuberance that fueled Internet enterprises in the 1990s. But Gates and Microsoft thrived by following a more traditional maxim of profitability: If you have to give a product or service away free, something must be fundamentally wrong with the business. Most of those fortunes vanished, along with the companies themselves, when the Internet bubble burst in 2000. Gates's remark brought to mind a host of high-flying Internet businesses from a few years back whose would-be tech-titan executives made overnight fortunes by selling stock in companies that gave away services online with little regard to balancing the books short term. Zennström hemmed and hawed before offering the answer: "A single-digit percentage." From the way he said it, one couldn't help but suspect that the digit in question was a 1. ![]()
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