Skype CEO Josh Silverman can’t stop smiling in this video interview we recorded in Menlo Park this morning. And no wonder – despite serious legal and spinoff drama, Silverman has managed to close his multi-billion dollar spinoff of Skype from eBay. His legal troubles have evaporated. Skype is growing like a weed. And he’s managed to keep his job running the business. Life is good.
All he has to do now is manage board meetings with two of the more forceful personalities on the planet – new investor Marc Andreessen and cofounder/new investor Niklas Zennstrom.
Well, that and keep this train on the tracks. Skype has exploded to over half a billion users, and is adding 300,000 new ones every day, Silverman says in the interview. 1/3 of usage is video, despite the fact that video calls can only be 1-1. Voice calls are multi-party. And revenue is cruising along at $185 million/quarter with 24.2% margins. Up to 20 million people are using Skype at any one time.
We talk a little about Skype’s business in the interview. But most of the focus in 2010. “You’ll see Skype become a lot more ubiquitous in a lot more places, both mobile devices as well as embedded devices,” he says, adding “expect to see us on a lot more platforms.”
We also spoke about Skype as a developer platform. Extras is now long gone, but Silverman reiterated that soon Skype will push far more powerful developer tools that can turn Skype into a service. That means Skype can run outside of the Skype client. That doesn’t necessarily mean Skype in the browser, they still say Flash isn’t powerful enough to run Skype in browser. But perhaps we’ll see Skype code being build directly into browsers.
We also spoke briefly about Chrome OS. Google’s new operating system doesn’t let users install software, meaning Skype is out. Flash is the only third party plugin Google will say will be included. Things like Silverlight and Skype are in limbo unless and until Google decides to include them. Silverman ends the interview with “If the Google folks are interested in building Skype into Chrome we’d certainly be interested in having that conversation.”
I hope they do have that conversation, soon.
“If the Google folks are interested in building Skype into Chrome we’d certainly be interested in having that conversation.”
Well they bought Gizmo5, so I don’t think this conversation will take place.
I am sure 3rd party developers will be able to build for Flash and other platforms.
Frankly I think Skype needs to think itself as the Voice Social Network and do what Facebook did.
Enable a program similar to Facebook Connect. That way developers can build apps on Skype app itself or integrate Skype service within their websites or desktop apps.
Google ignoring Skype is no different than Apple ignoring Google Voice. This is where Google needs to step up.
Google will play the platform role and simply say that Skype can enable a HTML or Flash version of the app for Chrome OS. I dont think they have to do anything special for Skype.
Not sure why Skype is punting on Flash. If Ribbit can build it so can they.
That will be interesting indeed. So will it use a Falsh server? Will it still be P2P?
Skype would be guilty of preferring to keep their client-side code proprietary. They don’t even have an API, but Google has open sourced their whole repository. Skype could write a native code application without any trouble, so it would be a distribution issue for them just as the desktop has been. I believe Flash 10.1 supports P2P.
All that money and Skype can’t staff a help desk? They charged my account for a phone number, deducted the money and never delivered me a number for Skype in even though status says it has been “Delivered”
Skype offers no live support, no contact or help person to call? really? Their programming and services are fail-safe?
How in the heck are you supposed to correct a billing error with these guys?
+1
easy, call your bank, and do a chargeback.
Skype billing errors happened with my account too, Several times.
But, most Web App companies think they don’t need to provide offer support to their users.
You’re right. Skype’s customer support isn’t great. They don’t have SkypeIn numbers for Canada. That’s the only thing holding me back from abandoning my home phone.
I must admit though, Skype seems more exciting with Andreessen and Zennstrom on board.
Good for him, that’s like a freaking entrepreneur hat trick.
Great interview Michael. Love how you pry for more financials.
I think it sounds a bit intimidating “if google is interested ….we are happy to talk”.
300,000 people a day? wow, that’s about 108 million a year. Where are all these people coming from?
The outer rim, Asia and Narnia.
if skype became a social network / added social network features, they could eclipse e.g. facebook in #users, daily engagement, and monetization. don’t forget they have a presence on the desktop (and mobile) too. huge.
Guys, lots of hype here. If you want a real service, that works from a browser (no softphone to download), or from any mobile (no client download) or any phone, with far better call quality than Skype and cheaper rates, then see http://www.foocall.com
This is real innovation.
Now that’s a brand name I can trust!
Wow! That is one happy dude.
Good post.
As much as I enjoy Skype – I have even purchased a few SkpeOut minutes – I have trouble imagining their future revenue opportunities. Selling long-distance service at a discount is a cut-rate commodity business with razor thin margins.
From an end-user point of view, the fact that Skype is P2P and VOIP is P2S2P does not make a wit of difference. All that will matter is whether or not they can make an outbound call to a land/mobile number at low cost. Gizmo5 will bring this to Google Voice. What then differentiates the Skype service?
Exactly, well put.
What differentiates Skype? 500 million users.
Also, when everyone is on Skype, then it will cost Skype $0 to terminate your calls, but they will still be able to charge people. They can undercut any competitor and it’s virtually 100% margin at that point. Similar to how paypal makes money “transferring” money from one paypal acct to another.
Prediction: Skype will eventually be acquired by google
btw, IMO.IM has already implemented Skype in browser using JavaScript!
j
Google does not need Skype and there is a cheaper way in acquiring the massive Skype user base. Why pay billions when you only have to pay $30 millions.
I think once Google integrates Gizmo5 with Google Voice and offer free domestic calls and lower rates on international calls, you will see the fall of the Skype empire. I don’t think Josh will be smiling then.
Who’s to say Google will stop there. How about Google Wireless…
> What then differentiates the Skype service?
256-bit AES encryption so not even the CIA can listen to your phone calls. Noone beats Skype for security, which is why I think you won’t see a webapp. Skype makes your CPU work making your calls secure. Not sure that will be easy on Flash.
Skype is one of the most amazing applications out there. One can see and talk to their family on the other side of the world, and a no cost!
Truly amazing.
admin
http://invetrics.com
Yeah he is really a smiley face and good to know about skype’s activities and I like the interview…
Yep Skype is extraordinary. Too bad here in Canada there are too many limitations in terms of using skype telephony. Typically canadian actually.
Ken, could this Canadian problem be because the socialist government can’t monitor your phone calls because of Skype’s 256-bit encryption of every call? Check that out and let us know what you find.
Congrats, Josh! Well done. Looking forward to Skype innovations in 2010.
Got skype on my new Ipod touch, is great. I cancelled my cell, people said “u r crazy” I answered “crazy is driving and talking in the phone” I have to limit calls to wifi areas thou Its Plenty folks!! I am communicating much better and easier than before and I enjoy all apps applications.
While at Mac 08 in San Fran, I asked at the Skype booth about a mobile application, and the person there mentioned that wasn t happening for them at the time, I m si glad that changed. 2 bucks for unlimited calls and another 2 for a phone number, that s what I call savings!!!
Next thing: Skype as an icon to call directly from anywhere, bye bye ATT as we knew it!!
Keep up the good work!!!!!
Wow…he really is a happy guy
I don’t see Google having a conversation with Skype. Google recently bought Gizmo5 and they also have Google Voice which is capable of making calls.
good point
I LOVE SKYPE, THATS A GOOD IDEA, THANKS
After finding Skype a few years ago it is now my most used IM platform. Glad to see Josh is having fun running the company.
Personally I couldnt believe that there are a 1/2 a billion users and the company is pulling down almost 50 million a month. Go Skype.
Wonder how long it’ll take before he’s either ousted from the company entirely or relegated to a position below the one he currently holds.
he should be totally happy! skype is doing grreat!!
Steve
http://www.isopurewater.com/