Skype introduces real time translation for 150 languages.
Delivering on its promise to deliver a translation service, the VoIP market leader has tied up with Voxeo and Language Line Services. Skype is also bringing social networking to crowds as it introduces a service enabling online conversations by groups of up to 100 people at one time.
Just take a minute to consider the implications of this: a free/cheap global internet based phone service which translates.
The real reason why eBay bought Skype?
So when eBay bought Internet telephony service Skype a while back for rather a lot of money there were murmerings about what in the hell the auction site was thinking. We just got all excited about Skype-enabled click-to-call ads eBay’s small time sellers via Skype… then this happens:
Skype to sell EMI music on retail site
EMI Music Publishing, the song rights company, yesterday announced a deal with Skype, the internet telephony business, to sell music on Skype’s new retail website.
Under the deal, Skype will be licensed to use song copyrights from EMI’s catalogue to sell music as downloads and ring tones. It is the first time that music copyrights have been licensed worldwide in such a way. Normally licences have to be applied for by the seller on a country-by-country basis, making it more difficult for songwriters to collect payments for their work.
Skype has not yet set a launch date for its new online store. The company recently signed a deal with the Warner Bros’ group of record labels, allowing Skype use of Warner Bros’ master recordings.
As the world’s largest music publisher, EMI has more than one million copyrights, including those to some of the best-known songs ever written, such as New York, New York, Singin’ in the Rain and Over the Rainbow.
The clever folks at MIT said this would happen (as did BST, kinda — check prediction #6). Back at the time of the eBay Skype deal they wrote:
The long post in a nutshell: I think eBay wants to use Skype as a distribution platform for content, micro-paid for through PayPal and accessible on a wide range of devices… Imagine a music library into which you can dial either with your Skype, or your cell phone, or even a land line. Finally, all those “free nights and weekends” will be put to good use. Also imagine each user paying a token amount — say, $0.01 — for each content unit, a song. The sound quality is good and the transfer is fast thanks to the Skype’s distributed model. Payments are painless and barely noticeable, and are debited directly from your PayPal account. Who needs satellite radio then? Who needs (oh my God) iTunes?
To cross sell its newly purchased Internet telephony service, eBay is auctioning 10 minute calls to celebs for charity.
Bids for a ten minute conversation with Penelope Cruz were at $560 at time of writing. It’s reminiscent of the 1997(?) One2One campaign featuring people like Kate Moss talking about who they would like ‘to have a One2One with’ (hers was Elvis). For our money, pretty much the best representation of what mobile communications really mean.
This too is a cute idea but surely eBay needs to hammer home that calls via Skype are … erm … free?
“They (the telecom giants) have enjoyed 130 years of good profitability”. But now, their star is “reaching the end of its life cycle. It’s going to die.” Niklas Zennstrom, co-founder of Skype.
So here are the facts:
- Voice over internet protocol (VoIP) uses peer to peer networks to make free telephone calls between computers.
- Skype has 68 million users worldwide.
- It is currently adding 175,000 users a day.
- Skype doesn’t advertise — it uses its users to recruit their friends.
Last September, eBay bought the company for $2.6bn with the promise of a further $1.5bn subject to performance. The auction site is already using the service to provide phone calls for high value/stress transactions such as cars and property. It has also introduced ‘click to call’ advertising via Skype on the site — direct response advertising that doesn’t require a website.
Speaking in today’s Independent, Zennstrom sounds eerily like Google and Gates in their heyday,
Skype is bigger than a product. We are going to make it into the world’s largest communications company… Probably in 20 years’ time we won’t even be talking about VoIP. VoIP will be the way telephone networks are.
Want more proof that Skype are set for world domination? They’ve just signed a wi-fi deal with Google which they hope will become the biggest in the world by the end of the year.
The strategic sleight of hand behind the successes of the second dotcom boom.
How long ago it seems, the dotcom bubble and bust. To our eyes, there are two real differences-which-make-a-difference between the first dotcoms and what’s going on at the moment:
- There’s a touch of the vaudeville magician about the current crop of dotcoms: while distracting their consumers (and the markets) with simplicity and openness, they make their money (and are betting their futures) on plans for media empires to rival anything we’ve seen before.
While punters are having fun with these new toys — uploading their photos, posting to their blogs, gawping at the bigshinything — those same consumers are themselves building, click by click, from the online terra nulla, new media territories where tomorrow the future of marketing and sales will be decided through products and services sold back to them via the channels they themselves have created. Brilliant!
As evidence, we offer the following:
- Google is still viewed as a search engine, but its revenue (and future) depends on its footprint as a media owner: every Google brand extension gives it more media surface on which to plant its ads — and as for targetting, who knows what you want better than Google?
- The must-have iPod probably only really exists to get iTunes onto people’s desktops, and to thus give Steve Job’s growing media empire an early mover advantage in owning media delivery in the next decade — leveraging both brand loyalty with consumers and his success in getting traditional content owners to actually sign up for online delivery — a major triumph given their conservatism.
- Skype wants ‘the world to call for free’, but still makes its margin from the extras it offers which allow Skypers to interact with the world of traditional telephony.
For these magicians, a little prestidigitation to keep the brand simple also makes it easier to expand or change the real business plan without having to worry whether its on-brand or not, and without really letting consumers into the secret that they’ve been charmed into doing all the hard work of building the market for them.
- It’s not just consumers being roped in to create the very markets in which the dotcoms wish to sell. The most savvy of these businesses offer out their services for others to innovate with.
Got a clever idea for a location-based service? Use Google Maps for the interface, and concentrate on the bit of your business that’s unique. Want to add voice chat to your dating site? You don’t need to spend millions on infrastructure, just build it using Skype. Google, Skype, Flickr and the rest make it easy for other people’s clever ideas to come to market: each business using their services increases their media surface and earns them some incremental revenue. Individual bloggers might add a few new pages for Google ads — a startup using Google Maps might just kick-start a whole new category of media in its own right. Lowering the bar for other clever businesses is a low-risk investment in the 99.9999% of innovation that happens outside the established dotcoms themselves.
These then are what the volume businesses for the 21st century look like — billion-dollar enterprises with cuddly, fun brands and friend-get-friend appeal, which offer access to their core services ‘for free’ to other innovators in return for new media opportunities in the ecosystems they encourage to flourish around them. And so far, it works: not only are these upstarts making obscene amounts of money, they’ve jump-started a new wave of creative systems and services. Look on their works ye traditional media giants, and despair.
It’s the time of the year for punditry… and lists. So forgive us if for a moment we get all trendspottery and suggest a few things we think we’ll see next year.
- As iPod sales start to slow down, we’re betting on a fierce brand-extension war between Apple and the other online music brands. Competitors have already started to emerge — see MTV’s tie up with Microsoft, Urge.
- In the same sector, we tip Napster to learn from Google and Yahoo’s mapping successes, and to offer a programming interface (API) for subscribers, so people can build their own software systems using Napster content — expect customised jukeboxes, recommendation systems and music-based games to flourish online. The benefit to Napster? Kudos to the brand which accrue from others’ innovations, a wider audience, and increased advertising opportunities.
- We’re waiting for a Friday night TV show which features real-time ‘stupid shit’, news and interviews contributed live via 3G mobiles by amateur viewer/reporters out and about around the UK and worldwide — the trash culture flipside of OhMyNews. Expect flash celebrity for a few contributors to follow, and a big spike in phone sales.
- Still on TV, we expect at least one channel to broadcast experimental blocks of ‘ad-free’ prime time programming to test the waters of post-interruptive-advertising television — probably initially sponsored by a major car brand.
- Flyposting will be banned in London as Ken sides with the Government on a ‘respect‘ agenda.
- Sophisticated services offered via Skype will be the surprise eCommerce success story of the year, with third-party developers exploiting the ubiquitous telephony provider’s APIs to provide simple, effective voice access to information, retail and search services in exactly the way that screen-based systems thus far haven’t, for the mobile multitudes.
- Namecheck BST when territorial disputes over mining rights in polar regions recently exposed by global warning become a major news story, and a source of growing international tension.
- And a big ‘we told you so’ if Interpol reveals that an unlikely counterfeiting alliance of criminals and ‘just because we could’ hackers has adopted open source development methodologies to make undetectable fakes of a major currency, which subsequently has to be completely withdrawn from circulation, redesigned and reissued.
- Long odds but not impossible: Sony’s launch of non-Sony-branded hardware or media, in an attempt at a fresh start after the horrors of 2005.
- We will be saddened but not surprised if a PC virus takes out one of the emergency services for at least a day.
- 3G. Finally. Yes we’re surprised too.
VoIP take up in China has triggered a trend of random cold calling to Western users.
According to a report in Time, Skype - whose software allows users to make cheap phone calls over the Internet – has become extremely popular amongst young Asians – with 45,000 new Chinese users signing on each day. Apparently many of them are using the service to practice their English – by cold calling fellow Skypers in the US. The company, which currently has 66 million registered users in more than 200 countries, includes language preferences in every user’s profile and last year started offering a ‘Skype Me’ mode that encourages calls from strangers (or stalkers, depending on your outlook). Like SMS was for the mobile phone industry, the popularity of this application has somewhat surprised the company. “It’s an area that, frankly, surprised us. People are becoming voice pals instead of pen pals.”
Skype, which is now of course owned by eBay, is looking into providing translation services as a possibly pay feature in 2006. Last week it released a web 2.0 edition that enables users to plug in their webcams and make free video calls. With Skype doing so much to shrink the world. maybe it should change its name to BabelFish.
Online auction site eBay confirmed today that it has bought Internet telephony company Skype in a £1.4bn deal.
eBay chief executive Meg Whitman said of the deal:
Communications is at the heart of e-commerce and community. By combining the two leading e-commerce franchises, eBay and PayPal (eBay’s online payment tool), with the leader in internet voice communications, we will create an extraordinarily powerful environment for business on the net.
The company said that the move would “strengthen eBay’s global marketplace and payments platform, while opening several lines of business.”
Certainly there are synergies between the two businesses. eBay’s global auction model is all about ease of communication and trust. Skype’s Voice Over Internet Protocol (VoIP) service could enable eBay traders to chat with each other far more cheaply than over traditional phone lines. Skype also has 53 million registered users and says more than two million people are using its software at any given moment. VoIP remains for the moment a bit of a ‘geek’ space technology – it’s bubbling under rather than over. But it is one that is set to explode as people get wise to the ease of use and cost savings involved.
The BBC has the full story.
Mediaguardian reports that eBay may be about to swallow up the leading Voice Over Internet company Skype.
The Guardian site picked up the story from the Wall Street Journal with neither eBay nor Skype agreeing to comment on the rumours.
The paper claims that eBay is offering between $2bn and $3bn for the company. Skype is the market leader in internet telephony and has attracted interest from companies such as Microsoft and News Corporation. The firm offers free calls to other Skype software users and charges as little as 1.1p a minute to fixed line phones in the UK. It says that an extraordinary 51 million people use its free service, while two million have signed up to pay for connections to traditional phones. Its nearest rival, Vonage, which recently launched in the UK, claims to have 700,000 customers and charges £9.99 a month for unlimited national calls, with additional charges for international and calls to mobiles.
Skype’s founders are certainly channelling the Dotcom Days in their Vanity Fair feature this month. Janus Friis and Niklas Zennstrom are pictured in what looks like a Lear Jet (sadly just the interior of the Kingly Club, London). EBay had better start counting its pennies.
See also previous post: Google Talks.
Is there anything that Google can’t do? This week the ultimate net entrepreneurs launched their own VoIP service: Google Talks.
This Wednesday it was reported that Google would be launching an internet telephony and messaging service. Last week’s announcement that Google was flogging off more shares sparked speculation that it was planning more acquisitions such as VoIP market leader Skype. This launch suggests that Google is confident enough in the strength of its brand to go it alone. It will also make its service an open platform for voice calls and instant messaging – this would challenge the ‘closed’ instant messaging networks run by Yahoo!, AOL and MSN.
Google took its first step into the communications business last year with the launch of Gmail – the invitation-only email that has already trounced hotmail as the address to have. Google Talk, a free service that lets two computer users talk or exchange messages, will be available only to people who already use Gmail. Google has now opened up Gmail to anyone in the US provided they give a mobile telephone number as a confirmation of their identity – this will eventually be available to people in other countries.
Google also launched on Monday an upgrade to its Desktop – the free software that allows users to launch programs on their computers. The move is yet another encroachment on Microsoft’s domination of PC desktops as the upgrade mirrors many Windows features.