1. Case Study Paul Dawson

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

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

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

5. 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

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

7. Performance Nine million registered users in the first year Over one billion registered users in 2013 280 million active daily users on average Two billion call minutes per day on average Acquired by Microsoft for $8.5 billion in 2011

8. Users

9. 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

10. 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

11. Market Share

12. 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

13. 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

14. 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

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

16. References http://gigaom.com/2011/06/13/comcast-skype-video-chat/ http://www.emory.edu/BUSINESS/readings/skype/eBay-Skype.pdf http://www.engadget.com/2013/06/17/skype-video-messaging-launches-free- unlimited/ http://www.inferse.com/8940/microsoft-skype-serious-threat-telephone- operators/ http://www.inferse.com/8940/microsoft-skype-serious-threat-telephone- operators/ http://www.nytimes.com/2009/09/02/technology/companies/02ebay.html?scp=8 &sq=silver+lake++skype&st=nyt&_r=0 http://www.princeton.edu/~achaney/tmve/wiki100k/docs/Metcalfe_s_law.html http://www.techbusiness.me/files1/skype.case.pdf http://www.voipinsights.com/voip_history.html http://online.wsj.com/news/articles/SB100014240527487037308045763148542 22820260?mg=reno64- wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB1000142405274870 3730804576314854222820260.html