Monday, September 12, 2005

I remember Skype

I come to praise Skype, not to bury it.

On a morning in early September 2003, I turned up at my office, switched on my PC and began checking news items and emails, just like on any other morning. In one email newsletter I subscribed to at the time, the pioneering IP Pulse, I found a link to this CNET article on Skype, detailing its launch a week earlier. This was an earth-shattering revelation to me at the time.

I had been in contact with Jeff Pulver for nearly a year, and had also developed a nice relationship with the folks at Vonage, and had written notes (one called "VoiPulverized") and presentations for clients discussing the impending changes headed Europe's way, and how telecom would never be the same. I had also recently done a lot of background research on P2P (KaZaA in particular) in expectation of a voice angle emerging, and in the preceding summer had published a note called "IM = Incumbent Marginalization," focusing on the early steps by MSN, Yahoo!, Apple and AOL to bring voice to the fore in their IM offerings.

As a result of these various activities, I had begun to articulate to clients a view of the future in which telcoland would suffer an "attack from cyberspace," in which the varying agendas of global internet players would move to incorporate/co-opt voice to meet their own goals, which almost certainly would have little to do with selling voice in the traditional sense (which seems to be coming to fruition before our very eyes). In short, given where I was professionally and philosophically at the time, the arrival of Skype on the scene was nothing short of a Godsend.

Understandably, having luckily seen something perfect wander right into the crosshairs of my evolving sector view, I wasted no time in putting out a quick email blast to clients under the recently established title of "EuroTelcoblog," and bashed out a leader piece devoted to Skype for our upcoming global sector monthly. This latter piece (the first of its kind from the brokers, as far as I am aware) included some fairly apocalyptic statements, to the effect that, for the incumbents at least, the arrival of Skype was akin to a meteor plummeting towards earth, and an even bolder statement that Skype's debut would turn out to have been the single most significant event in the sector in 2003. I'm still rather proud of this assessment, though I think my sales force at the time thought I was having a breakdown of some sort.

A couple of weeks later, I was working at home one afternoon when I got a call on my mobile from an upbeat-sounding American who identified himself as Howard Hartenbaum of Draper-Richards, and who characterized himself as the VC point man on the Skype project. We had a lot to talk about, both being American ex-pats in Europe, and both having Japan experience, including language. So the conversation was fluid and pretty easygoing, but the central point was (I'm paraphrasing here), "I have here a copy of the note you wrote on Skype, and it's great. I particularly like the reference to Skype being like a meteor headed for earth." I asked if Niklas Zennstrom had seen it, and the response was that indeed he (Niklas) had forwarded it to virtually everyone he knew on the planet. I expressed an interest in meeting him, and Howard said that should be do-able.

A few days later, I received a fairly terse email from Niklas, proposing a meeting, which opened with the line, "I understand you have written a note about our company." This, in particular, I loved, of course because I knew the real story. Not wanting to risk embarrassing him, I duly went through the motions of attaching a copy of the note to my response email, and proposed a meeting at our offices in London. A few days later he appeared at our offices, dressed rather scruffily in black from head to toe, initially confirming my preconceptions of an iconoclast internet terrorist (to my relief). However, during our ensuing 90-minute meeting, I found him to be very forthcoming, enthusiastic, and dryly humorous, and I sensed, from the subtext of our conversation, both a sense of inspiration and frustration at his experiences at Tele2, and also a need to overcome the stigma of the anticlimax which was KaZaA. In short, at the end of the meeting I felt I had not met an iconoclast internet terrorist, but rather a highly intelligent capitalist, with a desire to be acknowledged as a successful innovator and disruptor of cozy economic cartels.

I felt like we got on well in that first meeting, and had a couple of interesting lunches subsequently where we debated the issues facing the telecom industry. What really impressed me about Niklas, and flattered me personally, was that he always seemed to have his antennae switched on in these one-on-one meetings, and was as keen to hear my views as he was to share Skype's own thinking. Despite what was lambasted in the blogosphere as Skype Dogma and Skype Hype (i.e., the growing sense that Skype was merely trotting out its marketing message at every opportunity), and whatever the true nature of Skype politics towards standards and open source, I found him to be invariably gracious and open-minded. He was also typically forthcoming with operational data, such as the top 20 Skype countries data which he kindly supplied on a couple of occasions.

Sadly, I expect that things will change under eBay - access more limited, information much more guarded, and perhaps innovation more ruthlessly targeted towards larger corporate goals. Love Skype or hate it, I think we have to be honest with ourselves and acknowledge that this company, whatever its shortcomings, gave telecom the tremendous kick-up-the-ass it so richly deserved, and also scared the crap out of the internet/IM players, forcing them to up their game. The result should hopefully be a period of intense innovation in voice and presence applications, in which SkypeBay will no doubt play an important role.

For my part, Skype was one of the principal ingredients which helped to make this blog whatever it is today (hard to define, except that it is definitely not an economic route to early retirement in the Seychelles), and I can happily say that it has brought me into contact with a wide range of interesting people whom I would certainly not have had the pleasure of knowing otherwise. Though a bit melancholy at today's news, I am basically happy, and extend my thanks and congratulations to the Skype team and everyone who contributed to my Skype-related posts along the way. What a short, strange trip it's been.

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