by Tori Johnson on September 15, 2010

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Skype, the most popular VoIP (Voice over Internet Protocol) service provider in the world, is working hard to convince businesses to use its new Skype Connect service. Launched in August, users of Skype’s Business Connect are able to make outbound calls from desktops and mobile phones worldwide and receive inbound calls from other Skype users, cheaply.  The service is designed to decrease a company’s communication expense.

“Our team’s goal is to empower businesses of all sizes and types with rich communications tools to unleash their productivity, while reducing their telecommunications costs. Following Skype Manager’s launch in May, we are very proud to add Skype Connect to our list of specially designed enterprise solutions. Skype Connect seeks to enable our customers to reduce their phone bills, while protecting their investment in existing telecommunications equipment.”

– David Gurlé, VP and general manager of Skype for Business.

Skype has over 124 million connected users who have placed over 95 billion calling minutes this year; over 40% of these minutes were video calls.  Skype currently has more than a half-billion users worldwide.  According to TeleGeography analyst Stephan Beckert “The volume of traffic routed via Skype is tremendous. Skype is now the largest provider of cross-border communications in the world, by far.” Skype users were responsible for almost 13% of all international calling minutes. Those who think that Skype is used just for personal phone calls should know that in the first quarter of 2010, 37% of Skype users reported that they used it for business or business-related purposes.

And then there’s Cisco

Why would Cisco be interested in purchasing Skype?

CEO John Chambers is positioning Cisco as a dominant player in the $34 billion dollar business and personal video teleconferencing market. In June of this year Cisco unveiled their version of an Android tablet that will offer HD video streaming, real-time video, multi-party conferencing, all the regular tablet functions (like messaging, email, and browsing), plus a telephone handset wired for the Internet.  Called the “Cius”, the tablet is specifically designed to upgrade the office desktop replacing the desk phone with more interactivity for video. Cisco’s market strategy also included the purchase of the video conferencing company Tandberg for 3 billion dollars earlier this year.

In the last few years Cisco has been selling videoconferencing equipment to large companies. With the purchase of Tandberg, Cisco broadened its “Telepresence” to provide consumers with home based teleconferencing.  According to Cisco:

The future is here now with Cisco TelePresence

Discover the full range of Cisco TelePresence solutions and experiences for yourself…

See hello. Welcome to your future at work, in class, on the road, in your community or at home…

Now it’s easier than ever to see facial expressions for those crucial businesses

And right now that face is seen over the Internet and television via Skype.

Cisco, Skype and the Future

Although the acquisition of Skype would give it an instant user-base of at least 124 million active members worldwide, how the use of this base will financially benefit Cisco is not clear. However the deals that Skype has made with Verizon and Samsung will definitely expand Cisco’s possible client base for the sale of its new tablet. As far as hardware is concerned if Cisco buys Skype it will be able it to add VoIP (Voice over Internet Protocol) to its new tablet.

While TechCrunch reports that Cisco is seriously considering acquiring Skype, neither company has confirmed that they are even discussing the matter.  But it won’t be a surprise if a deal between the two companies is cut.

With regards to Skype’s financial future:

… we’re not years away from a time when 100 million people can run Skype at all times on their mobile.  The real impact of IPhone 4.0 is it will almost instantly double the number of Skype Users online

– Stuart Henshel, Chief Strategist and Facilitator at Mosci

And that’s just it — in addition to its Skype Connect program for business, and deals with Verizon and Samsung, Skype is poised to become the most profitable VoIP provider in the world. It would be quite a purchase for Cisco if it comes to pass.  Either way, the fast-paced developments in technology are creating an exciting marketplace and lightening speed changes in the way we do business.

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