Feeds

Who will buy Skype? Yahoo!? or Google? or Rupert Murdoch?

Never mind the quality, feel the width!

  • alert
  • submit to reddit

Secure remote control for conventional and virtual desktops

Rumours of a Skype valuation of $3bn Rupert Murdoch's New International from columnist Bob Cringeley, dismissed by another columnist (Simon Edhouse of Virtusoft) have surfaced - but is Skype a valuable commodity, then?

The question has hidden answers, because most of the people who are likely to be interested in Skype are not yet showing their hands in the marketplace.

Specifically, two companies have leaked drips of information about their telephony plans: Google and Yahoo! are both known to be planning a complete package.

In the case of Google, nothing has been confirmed, but advertisements have been seen for the sort of people who are needed to manage a combined wireline, gateway, mobile and wireless IP phone network.

In the case of Yahoo! even less has been published, but again, preparations have been apparent from hirings of staff and purchases of equipment.

Both companies would be crucially handicapped if the other bought Skype, and really, the only reason either might fail to buy the peer-to-peer phone network, would be either that they came second in the race, or that Skype really didn't want to sell.

What is Skype worth? Cringeley says Murdoch offered $3bn; there's no validation of this news. But (says Bloomberg) Tim Draper, managing director of venture capital firm Draper Fisher Jurvetson, "compares Skype to free email company Hotmail, purchased by Microsoft in 1998 for US$450m and now boasting 190 million users. He calls Skype a classic disruptive technology."

Draper, apparently, thinks $3bn is peanuts, and is thinking more in terms of $100bn - hard to relate, in accounting terms, to any sort of projected revenue Skype might ever make.

The analysis is all based on the assumption that Skype faces no rivals, no technical challenges. This is almost certainly wide of the mark.

In terms of rivals, Microsoft's MSN is already close to achieving a profile with its MSN Messenger which has good credibility as a telephony provider; Yahoo's instant messenger service is less credible as a voice carrier, but that will all change before the end of this year, when it unveils its plans in mobile and VoIP telephony.

In terms of technology, Skype has a real problem: it relies on "supernodes" - users who have direct Web access to a "real" IP address. The traffic in and out of normal nodes wouldn't be capable of travelling between two subscribers; there are no inbound routes. So the software fakes a session through a supernode.

The problem seems to be: the number of potential supernodes is dropping, and the number of ordinary nodes - behind mapped addresses or firewalls, or both - is going up rapidly.

The result: quality of calls is falling. Bandwidth available is poor compared with a year ago.

This problem is one Skype may solve before it becomes visible to potential buyers. If it thinks the solution is easy, it has no need to rush to accept a suitor.

So: if Cringeley's rumour is right, then the next two weeks will show how optimistic Skype founder Niklas Zennström is. If he sells out before September, we can deduce he's not sure about being able to solve the technical challenge. If he hangs on, we can suspect he's got it cracked.

© NewsWireless.Net

Related stories

PGP inventor to debut VoIP crypto
Vodafone takes the fight to VoIP
The Cloud touts Skype Zones support
Vonage fixes voicemail snag
Vonage calls for 'naked DSL'
VoIP use on the up-and-up

Protecting against web application threats using SSL

More from The Register

next story
Brit telcos warn Scots that voting Yes could lead to HEFTY bills
BT and Co: Independence vote likely to mean 'increased costs'
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
New 'Cosmos' browser surfs the net by TXT alone
No data plan? No WiFi? No worries ... except sluggish download speed
Radio hams can encrypt, in emergencies, says Ofcom
Consultation promises new spectrum and hints at relaxed licence conditions
Blockbuster book lays out the first 20 years of the Smartphone Wars
Symbian's David Wood bares all. Not for the faint hearted
Bonking with Apple has POUNDED mobe operators' wallets
... into submission. Weve squeals, ditches payment plans
'Serious flaws in the Vertigan report' says broadband boffin
Report 'fails reality test' , is 'simply wrong' and offers ''convenient' justification for FTTN says Rod Tucker
This flashlight app requires: Your contacts list, identity, access to your camera...
Who us, dodgy? Vast majority of mobile apps fail privacy test
Apple Watch will CONQUER smartwatch world – analysts
After Applelocalypse, other wristputers will get stuck in
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
Security and trust: The backbone of doing business over the internet
Explores the current state of website security and the contributions Symantec is making to help organizations protect critical data and build trust with customers.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.