Section 6.1. Skype and Competitors


6.1. Skype and Competitors

It may seem that Skype appeared from nowhere and pioneered the idea of a software phone using a peer-to-peer connection model. There was nothing, then boom, there were millions of Skype users. But that's not exactly how it all developed.

Active Internet Telephony pioneers were creating the foundation for years, building on earlier video-conference work, but 1995 may be the year technology gelled enough to get serious (a company named VocalTec released the first Internet Phone on February 15 of that year). The maturing Quality of Service protocol, necessary to keep voice streams traveling over the Internet from becoming garbled, provided an excellent starting place for developing the standards for Internet Telephony.


Note: Acronym AlertSIP = Session Initiation Protocol

Today, we have Skype on one hand and SIP (Session Initiation Protocol) on the other. Skype development comes from a small group of talented programmers and marketers responsible in part for the popularization of peer-to-peer applications through their first success, the KaZaA file-sharing service. SIP development comes from a larger group of talented programmers distributed throughout the world and coordinated by the oversight group that developed and standardized (among many other things) networking and the Internet. It's a fun competition, and we consumers will be the better for it, although it will be a bit messy for the next couple of years.

The SIP users have one thing the Skype folks lack (at least now, in early 2005, while the SkypeIn incoming call service remains in limited beta): the ability for traditional telephone users to call them. Some SIP companies offer virtual numbers that work just like the ones from Vonage and their competitors (discussed in Chapter 5). A SIP phone user, even when they use a softphone and headset, can be called just like any other traditional or cell phone, if they have purchased an optional virtual number.

There are also a few gateways from the traditional telephone world to the SIP phone provider networks for the users who don't want to pay for virtual numbers or have little need for them on a regular basis. Traditional telephone users can call these gateways (none are toll free), then dial the special SIP phone number they wish to reach.

Skype's SkypeIn service will provide virtual numbers for Skype users so they can take calls from traditional telephones, but it's still in beta testing as I write this. It will be a paid service, like the virtual numbers for Vonage and the SIP phone providers. No official pricing has been announced, but rumors from the beta say the price should be around $3 to $4 per month for an inbound phone number. The SIP phone world already has its SIP-In service, and it is ahead of Skype, at least for the time being.

6.1.1. The SIP World

Technology companies follow trends, and one trend today is for SIP-based telephone developers and services to use "SIP" in their name somewhere. Here are some examples:

  • www.sipphone.com

  • www.sipsoftware.com

  • www.sipcenter.com

  • www.sipforum.org

There are many other companies in this market without SIP in their Internet address, but they usually have SIP at the top of their web pages and product literature. That makes sense, because this remains a developing market full of companies struggling to make their place and gain name recognition. In fact, the entire SIP world still needs more name recognition.


Note: SIPTechnically, SIP works much like HTTP (HyperText Transfer Protocol), the supporting protocol for the World Wide Web. It's also lightweight, open, flexible, and text-based. Messages include headers (address and routing information) and the body. SIP is an application layer protocol (high up on the network protocol ladder so it can traverse a variety of network types) and controls session creation, modification, and termination.

SIP messages set up calls, create the connection for the call for underlying protocols to handle, and send disconnect instructions when the call is terminated. SIP also works for multimedia conferences and multimedia content distribution, so you will see some interesting things from SIP companies beyond telephone calls in the next two years.

6.1.1.1 SIPphone

The great thing about SIP and softphones using a SIP foundation is how easy it is to get started and try them for yourself. Take a look at Figure 6-1, the opening web page for SIPphone.

Figure 6-1. Download and call from your computer


You can download and install the software and be talking with other SIPphone users in just a few moments. SIPphone also allows you five free minutes of connection time to traditional telephone lines.

Interestingly, SIPphone was started by the man who created the best free music download site, MP3.com (since sold off because of record industry harassment and not nearly so cool today). Michael Robertson also started the popular Linux operating system company called Linspire (www.linspire.com), which used to be named Lindows until Microsoft sued them because they thought the name Lindows infringed on the name Windows. And you thought the computer business was boring.

Notice the D-Link router in the bottom-right corner of Figure 6-1. Just like Vonage, many SIP vendors allow you to connect existing analog telephones to your broadband connection. Unlike the Vonage units (and those from almost all of Vonage's competitors), the router available from SIPphone is "unlocked" and will work on any broadband phone service. It takes more setup and configuration initially, but you can keep the same router if you change services.

6.1.1.2 FreeWorld Dialup

Jeff Pulver started telephone innovation way back before it seemed possible. As a teenager, he linked his family's cordless phone to his ham radio set, giving himself a car phone in the early 1980s (so said BusinessWeek Online in April 2003). In 1995, he stumbled across the VocalTec Internet Phone late one night and bells went off. I'm guessing they were phone bell sounds generated by a computer.

He was the push behind VON (Voice on the Net) conferences (www.von.org) and VON magazine (www.vonmag.com), and Pulver also started one of the early SIP phone companies, FreeWorld Dialup (www.freeworlddialup.com). You can use FreeWorld Dialup to call other FreeWorld customers, and Pulver has negotiated connections called peering arrangements with two dozen other SIP providers. He also includes broadband to traditional telephone gateways so his users in a half-dozen countries can dial out to 800 numbers. Figure 6-2 shows the FWD (as they acronymed themselves) home page.

Pulver organized the VON conference advertised in the banner ad on the lower-left side of the page, and he has gathered together the smartest people in the world of Internet Telephony each year since 1996. It's safe

Figure 6-2. Free calls from a pioneering service


to say that Jeff Pulver should be named the matchmaker for a huge number of the companies in this market. He also cofounded Vonage, but left early after their initial venture capital investment round of financing.

Yes, there's a peering arrangement with Vonage. The FreeWorld Dialup information even includes the special prefix number you dial from Vonage to reach a FreeWorld dialup user, something Vonage doesn't make easy to find (at least I couldn't find it on Vonage's site).

It's hard to bet against Jeff Pulver and FreeWorld Dialup, and it's hard to bet against SIPphone and Michael Robertson. They've both done interesting things and have records of success. If you know someone using a traditional telephone who wants to call you occasionally, however, SIPphone is a bit farther down that road than FreeWorld.

6.1.2. Skype

Nobody was waiting for a new peer-to-peer phone service using personal computers for phone equipment back on August 29, 2003, but there it was:

We're proud to announce the public release of Skype Beta and the arrival of P2P Telephony! Skype allows anyone to experience free, unlimited, high-quality voice communication over the Internet. Skype software is free to download and you can always get the latest version by clicking here.

Few, if any, people put together the founders of Skype, Niklas Zennström and Janus Friis, with their previous success, the KaZaA file-sharing network used by millions and millions to swap files of all kinds. Unfortunately, the files they most often swapped were music files they didn't own, since by then Napster was getting heavy pressure from the recording industry to close and many users migrated over. KaZaA, a pure peer-to-peer technology, didn't have a centralized server tracking all their registered users like Napster did, so they kept a step ahead of the lawyers.

But we can't blame Zennström and Friis for what KaZaA has been up to the last few years, because they jumped out. They call Skype their third generation file-sharing network project, and the best one to date. They are right.

Although KaZaA owns the record for downloads at over 370 million, Skype already has a 100 million downloads and counting less than two years after their initial beta release. Skype is also free of all the spyware and other garbage that's given peer-to-peer file-sharing programs (KaZaA to a lesser extent than most others depending on who you talk to) such a bad name the last few years, so download without fear.

Based in Luxembourg, Skype has huge uptake in Europe and Asia but less in the United States. Part of the reason is that long distance call pricing in Europe often staggers the wallet, and most European countries have higher broadband bandwidth than the U.S.

Companies wishing to integrate Skype into their own communication plans can do so, since Skype offers a Software Development Kit. I believe the use of Skype on PDAs with wireless broadband connections makes a great deal of sense for mobile employees who need to talk to other employees. Push one button, connect to another employee, talk, and don't pay a penny for the phone call. Even if one employee is in Seattle and the other is in Miami, not a penny is required. As long as both have access to the Internet, they can talk as much as they want for free.

In early 2005, there were over 75,000,000 Skype software downloads, but many are duplicates as existing users download upgrades. Over 20 million unique usernames were registered by that time. Often, two million members were online and active at the same time.



Talk is Cheap
Talk is Not Cheap!: Saving the High Costs of Misunderstandings at Work and Home
ISBN: 1885167334
EAN: 2147483647
Year: 2006
Pages: 102

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