Case Study Paul Dawson

Agenda Business Model Background Core Technology Revenue Stream Performance Competitive Advantage & Marketing Competition Growth Strategy Questions

Business Model Service that allows for calling through the internet. B2C Pure Digital Model for Core Service

Background Founded in 2003 by Niklas Zennström and Janus Friis. Goal was global change in the way calls are made

Core Technology VoIP – First transmissions in 1973 – Internet phone software offered to the public by Vocaltec in 1995 – Broadband infrastructure not available or widely used at that time Peer-to-Peer – Utilized by other file sharing services – Software combination allowed for clear, reliable calling

Revenue Stream Freemium – SkypeIn – SkypeOut – SkypePlus Hardware – Webcams – Headsets

Performance Nine million registered users in the first year Over one billion registered users in million active daily users on average Two billion call minutes per day on average Acquired by Microsoft for $8.5 billion in 2011

Users

Competitive Advantage and Marketing Superior call quality – Sophisticated routing – Quality Servers Marketing Strategy – Customers refer the service to their friends – Metcalfe’s law of network value

Competition Disruptive Technology – As of September 2013 telecommunications operators were losing roughly $100 million per day in revenue due to Skype and other similar services. Traditional phone providers have reduced fees and bundled phone service with cable and internet. Google Voice offers free VoIP to non VoIP calling for US inbound calling

Market Share

Growth Strategy In 2011 Skype partnered with Comcast to allow subscribers to do videoconferencing through their Television sets. In 2013 Skype offers free video messaging service for Windows and Mac OS, iOS, Android and BlackBerry

Question 1 Skype’s success can be attributed mainly to: a. Aggressive Marketing b. Superior call quality c. Being the first provider of VoIP calling d. Competitive pricing

Question 2 Skype’s core business model is best described as: a. Bricks and clicks b. Brick and mortar c. Cloud computing d. Pure digital

Question 3 Skype benefits from which law? a. Network value b. Law of attraction c. Moore’s law d. 5 second rule

References unlimited/ operators/ operators/ &sq=silver+lake++skype&st=nyt&_r= ?mg=reno64- wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB html