mis presentation on skype business model

SKYPE MIS PRESENTATION09BM8078

INTRODUCTION TO TELECOM SCENARIO

Economy, services, industry

Telecom industry growth: The government has also legalized Internet telephony (Voice over Internet Protocol or VOIP for short) April 1, 2002

Major players and challenges

Opportunities

NEW WORLD ORDER

Emerging areas

New services: basic telephony, PC-to-landline/mobile/PC calls, IMs, video calls, video-conferencing, file-transfer

Players: Skype, Gtalk, Jajah, Yahoo’s VoIP, Lycos, phone.com, AltiGen, Micrsoft

GOSSIP IS THE HUMAN EQUIVALENT OF'SOCIAL GROOMING' AMONG PRIMATES

SKYPE INTRODUCTION

Software that enables the world's conversations.

Millions of individuals and businesses use Skype to make free video and voice calls, send instant messages and share files with other Skype users.

Everyday, people also use Skype to make low-cost calls to landlines and mobiles

SKYPE IS A COMMUNICATIONS TOOL

Humans are really, really, interested in things that help us communicate with each other more and better.

From cave paintings to mobile phones, it’s always the same.

And this is even more true for young people. They are forging their social identity through conversation.

NATURE OF SERVICES

voice calls over the Internet Calls to other users of the service and, in some countries, to free-of-charge numbers, are free, while calls to other landlines and mobile phones can be made for a fee. Additional features include

instant messaging, file transfer and video conferencing

Skype is free

Free is quite interesting to people. Especially free and good.

And it’s more interesting still to impoverished young people!

If you tell your friends to get Skype too, you can talk for as long as you like without worrying about the cost or the distance.

SKYPE’S SUCCESS

0 to customers in 2.5 years.

Nearly 200 million customers today.

Still growing at 200,000 new users every day.

RIGHT IDEA, RIGHT TIME

There was plenty of internet calling software before Skype. But it didn’t work very well, and lots of people still had slow dial-up internet connections. Plus it was called VoIP, which was a bit off-putting.

Skype was called Skype instead, and it just worked. And it arrived just as lots of people were starting to get broadband internet access.

It’s a very ‘native’ product for young people.

SIMPLE AND EASY

Skype worked really hard on making Skype as easy to install and use as possible.

We knew it was easy enough when Geoffrey’s grandma could use it. (Geoffrey is one of the original Skypers.)

Ease of use is important for busy young people too. Hence the iPod, people moving to Facebook…

Facebook group

Giving influencers new stuff Skypecasts are a new way to have

conversations with people across the world who share your interests.

Pick a subject you’re interested in from the directory, and join a hosted call with up to 100 other people from around the world.

Our early-adopter influencers are helping us pioneer and shape this new way of communicating.

Skype feels free Skype is free. More than that though, it feels

free. Free helps people realise that Skype is a

different kind of company. We took something that big companies

charged quite a lot for, and gave it to you for free. Nice, eh?

Skype does a lot It’s a fast world. People get bored quickly. Part of being committed is keeping doing

stuff – it’s not good enough to have done it once.

The advertising industry’s idea of the reductive ‘big idea’ is no use here.

It’s about doing lots of little things, that all add up to a rich, complex and involving brand.

WHAT DIDN’T WORK?

WHAT IS VIDEO CONFERENCING? Interactive

telecommunication technology

Conference between two or more participants at different sites by transmitting audio and video data

Tools: Video camera, microphone, speakers on device

VIDEO CONFERENCING CELL PHONES: A BUST!

• Buy a specific phone • Cost of the cell phone is

expensive• Poor image and sound

quality• Position of the camera is

in the back of the phone– Awkward– Pointless

VIDEO CHAT SOFTWARE

SKYPE Software application that allows users to make voice and

video calls over the Internet Initial names: “Sky peer-to-peer” and was abbreviated to

“Skyper” Since the domain name was taken, the creators dropped the “r”

and left the current title “Skype” Special features:

Conference Calls with multiple people Send Files instantly Connect to your land line Get your calls forwarded when you’re offline Send Text from skype Incoming calls from anyone

Great for individuals and businesses Affordable

Free: Both users having Skype accounts Pay as you go or Monthly payment

Calls to landlines and call phones

TOP 3 VIDEO CONFERENCING SITES

iChat Must have Mac

computer expensive 2009: est. 12% Most businesses use PC

Google Talk Both parties have to

have gmail account

Skype

SKYPE IN A BUSINESS ASPECT Great way to communicate in real time A way to communicate without physically being

there Can work anywhere at anytime Better communication

Less errors: everyone can look at the document at the same time and communicate

Changes are visible Deal with off shore clients Establish and maintain business relationships Improves Customer service

SKYPE AND EDUCATION

Video conferencing with authors Tutor session

Language tutor around the world Study sessions Great way to Q & A with

teachers and T.As

PORTER’S MODEL ANALYSIS

New Market Entrants

Buyer Power

Supplier Power

Competitive Rivalry

Product and Technology Development / Substitutes

COMPETITIVE RIVALRY

• Jajah: . The service requires no client to download, and doesn't actually use a user's PC to make the call.

• Yahoo's VoIP Yahoo Messenger

• Lycos : A bundle of freebies

• PHONE.COM : With no hardware to purchase, no switching of business phone systems provider

• VIA TALK : A bouquet of services

• 8X8 INC. :

BUYER POWER

Cost

Access

Features

Quality - video, voice

SUPPLIER POWER

IT-Infrasturcture companies e.g. Cisco Voice/Video Carrier

NEW MARKET ENTRANTS

• MICROSOFT :

As the VoIP (Voice over Internet Protocol) market continues to grow, computing heavy weight Microsoft have announced plans to enter the market

with the release of their Office Communications Server.

• AltiGen :

AltiGen, a provider of VoIP business phones and Microsoft-based Unified Communications offerings, has signed a deal with Italian distributor and

telecom equipment vendor Hypercom.

The move will allow Hypercom to sell and distribute AltiGen VoIP products to companies through Telecom Italia.

SUBSITUTES

Mobiles with 3G/2G Landlines Video-conferencing

SWOT ANALYSIS

Strengths E-bay Skype’s brand equity User base Conducive environment for growth

Users Culture Infrastructure

Skype-to-Skype calls accounted for 54 billion out of a total of 406 billion international call minutes in 2009.

STRENGTHS

Skype is confident of maintaining its growth in customer numbers of about 30-35 million per quarter for some time to come

reported more than $550 million in sales for 2008, with $145 million in the fourth quarter, up 26 percent on a year ago.

By the end of 2008, the company had 405 million customers, up 47 percent in a year.

WEAKNESSES

Low penetration of broadband relatively low visibility

OPPORTUNITIES

BPOs and call-centers Collaborations with leading Indian ISP (like

Airtel, Satyam etc) or portals (like rediff , indya.com etc) and bundle free downloads (same strategy followed by Skype in China , Japan)

Aggressively Advertise Skype out charges in Indian Media

Plunging broadband rates , large no of citizens, customer base living/working abroad ,booming economy and sheer numbers makes India and also China very good markets and worth fighting for in future

In February Skype secured a deal with Nokia under which the world's biggest phone maker will preload Skype software into some of its new smartphones.

THREATS

High growth means highly competition Easily available subsitutes Technology ever changing Intelligence agencies Majority of people extensively portals like

Yahoo, MSN or rediff for checking emails/search/IM

Skype’s two day outage

GROWTH AND FINANCIAL IMPACT

Skype-to-Skype calls accounted for 54 billion out of a total of 406 billion international call minutes in 2009

Skype is confident of maintaining its growth in customer numbers of about 30-35 million per quarter for some time to come

Reported more than $550 million in sales for 2008, with $145 million in the fourth quarter, up 26 percent on a year ago.

By the end of 2008, the company had 405 million customers, up 47 percent in a year.

SUMMARY

A great Web 2.0 business Significant growth opportunities Leverage on the brand Buzzes quite well with everyone!

Thank you