The problem with giving something away
Skype announced this week that their network has supported 10m con
current users for the first time. As Techcrunch points out: if only users were pots of gold…
This follows close on their admission that revenue projections had been somewhat “front-loaded” (an adjective rivalled only by “pre-revenue”, which cropped up on this week’s Dragon’s Den, as a euphemism for “we’re not making as much money as we thought we would”).
Skype are beating a well-trodden path: build a user-base first, worry about monetization later. The problem for Skype is that they make no money from Skype to Skype calls, only Skype to non-Skype or vice versa. So as the network gets bigger, Skype's opportunities to make money, perversely, become smaller.
Kind of like more and more people coming to your party, but drinking the hooch without bringing a bottle. Something to think about.
Posted by: Sam at Lunch time on Thursday, 18th October 2007
I thought that Skype were going to do voice auction stuff after they were bought by ebay. There's too much money slooshing around the world anyway and if they stick the money into more disruptive tech like Joost thats good enough for me. Nice blog btw.
Posted by: Charles Frith
Whose url is http://charlesfrith.blogspot.com