Will Telcos Notice Skype? Yup, They Are Infact Scared.

Read some statistics on SkypeJournal about Skyp's growth and comparisions with Telco's traditional revenues. The author says that the dent made by Skype is so low that Telco's won't even notice Skype.

Numbers may be low. But, Telcos are infact scared of Skype and its clones all around. Go to any conference. Open any report. View any presentation or listen to any conference. Nothing starts and ends without mentioning the threat from Skype and its clones.  Why, Skype is eating out 25% of VOIP growth. Read on.

Interestingly, though, Skype's growth has not yet had a quantifiable impact on switched volumes.


  • Skype traffic grew by 6.2 billion minutes in the last year. From 7.6 billion minutes in 2005 to 13.8 billion projected in 2006. 80% year over year.

Just in case that's sounds like a lot...

  • Other VoIP traffic grew by 16.8 billion minutes to 42 billion minutes. These are the Vonages, cable and telco voip offerings.

Their growth was bigger than Skype's total traffic. But wait, there's more.

  • Swtiched telephony, grew 8% to 237 billion minutes. Switched growth was 18 billion minutes.

So even if Skype traffic is growing 10 times faster than switched service, picking up a few points of share, the Skype threat falls into telecom's background noise. Skype's revenue doesn't even fall in telecom's rounding errors.

If you look at the growth alone: Skype has around 6 Billion minutes, while Switched traffic has 18 Billion minutes and VOIP traffic has 16.8 billion minutes. That accounts to roughly 1/3 of switched traffic and roughly 1/3 of VOIP traffic as well. Quite considerable or not? I bet, its still a good number. Look at it this way: Skype is eating out 25% of Telcos VOIP growth.

It will be interesting to see categorised minutes to get a good feeling of where Skype and its clones are used the most. For example, international minutes. Skype's adoption to masses hasn't even begun due to lack of handsets. Many of us don't like to glued to PCs to make a call. We want to move around. So handsets that can directly connection internet on WiFi will change the equation drastically. At this point, though these handsets are available, they are quite expensive ( $100+). If price comes down to $40-50, it would be interesting to see how these numbers jump up for Skype. I bet, they would jump beyond expectations.

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