Wednesday, November 19, 2003

The Skype is Calling

The Skype is Calling: "Skype began with a walk in the park. In June 2002, Friis and Zennström found themselves in a park in Copenhagen, Denmark, contemplating what to do next. Kazaa had been sold to Sharman Networks. But "we weren't going to retire," says 27-year-old Friis. So he and his partner (who is 37) began to hunt for a new project. They were looking specifically for industries ripe for a disruptive technology. “We wondered what we could do now, what would be big. We wanted to do something that could reach millions of people,” says Friis in a telephone interview from Stockholm. “During our discussions," he adds, "we determined that telephony was extremely well suited for a peer-to-peer disruption.” The key metrics? “It was centralized and expensive,” says Friis, referring to the fact that the telecommunications industry is controlled by large, profit-seeking companies. Skype bypasses those companies entirely.
Friis and Zennström researched and found that a technology for routing phone calls over data networks—called Voice Over Internet Protocol (VoIP)—was, after years of very limited use, finally taking hold. The surge in VoIP's popularity stemmed chiefly from a rapid increase in the number of homes installing broadband, always-on Internet connections. The two programmers realized that the peer-to-peer infrastructure they used with Kazaa was well-suited to VoIP because it could scale cheaply (no central servers to purchase and maintain) and redundancies were built in: multiple users routed calls, so a conversation wouldn’t be interrupted if a user logged off when a call was being routed through his system. What’s more, because the routing would be done by users, Friis and Zennström wouldn’t have to purchase expensive infrastructure. They could therefore offer the basic service for free.
Skype has the potential to be bigger than Kazaa,” Friis insists. “But the great thing is it doesn’t come with the legal issues around it.”
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