No. of Recommendations: 1
Skype, eh... They do a pretty good service.

I've been following VOIP in general and writing a few blog postings on this part of my site:

eBay bought them up about a year ago. I remember the TMF crew posted an article about that time saying they were about to write a recommendation to buy Skype stock when they IPO'd, but eBay beat them to the punch. Which just showed eBay's intelligence to the TMF crew. I think that's how the article went.

Anyway, one thing about Skype is they don't have to build much of their own network infrastructure. It's a P2P application, so their client applications connect directly to each other rather than going over Skypes infrastructure.

Where "picks and shovels" would fit for Skype is to study up their commercial partners. Skype has so far been delivering software, but recently they've developed some commercial partners who are selling devices that have skype software embedded in them.

At CES there were several announcements, which you'll find repeated on my site (above). You can also find them in the press releases section on ... as I recall both Netgear and Cisco/Linksys have made announcements, as well as Panasonic?

There are some issues around VOIP service that make for interesting societal questions. Namely the VOIP providers want to replace telephone service, so they (in my opinion) had better do a good job of replicating telephone service. For the most part they do a great job, and in many ways are far more flexible than telephone service.

But there's some regulatory concerns ... which I've covered some on my site. For example ... what about providing 911 (emergency dialing) service? Last year someone who had only VOIP service died when they'd called 911 and did not get routed to emergency service.

The FCC and other agencies have been making regulatory moves. Skype in particular has been egregiously stonewalling regulatory moves. I think they're being short sighted and showing poor judgement. At the same time I appreciate the technical quandry. But, if they're going to provide telephone service, then they had better be stepping up to the plate and offering the full suite of services. Because people will expect it to be telephone service, they will cut off their regular telephone service, and then they'll have an emergency and expect the telephone to work the same way, and who cares whether it's skype or not.

The cell phone providers already went through this and did their E911 conversion. Now it's time for VOIP providers.

Another issue that's very recent is the traditional phone companies. They're getting uppity about the "free ride" internet services are getting on "their" lines. The line the traditional phone company CEO's are saying is they want to charge the internet companies an access fee to send their packets over the phone companies wires.

Well I think those phone company CEO's are nuts. The customer of the phone company is paying for the line already. Therefore it's up to the phone company to charge enough for access to the Internet to pay for that line. It's innapropriate for the internet companies to also pay the phone companies.

- David

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