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Ben McConnell

February 11, 2004

Changing the world, again

The duo that brought the world Kazaa (and picked up where Napster failed) has used strong word-of-mouse networks to build their new monster: Skype, a PC-based telephone system.

There's nothing new about PC-to-PC telephony, but Janus Friis and Niklas Zennstrom know a few things about viral strategies and upsetting industries.

As this Fortune article discovered:

[Skype's] P2P underpinnings mean that Skype can grow without adding much, if any, infrastructure. It costs Vonage -- the top provider of paid Internet telephony, with 97,000 users -- almost $400 to add a new customer. It costs Skype $0.001. Not only has Skype been downloaded more than 6 million times in six months, it is regularly used in more than 170 countries -- and it has spread by word of mouth alone.

In the customer evangelism model, Skype is doing several things very well:

1. It has generated significant buzz within influential networks.
2. It's free, which is the ultimate bite-size chunk. (Eventually, Skype will create revenue by charging for add-on services such as voicemail.)
3. If ever there was a cause for rallying angry, continually dissatisfied customers, it is destroying and rebuilding the telecommunications industrial complex. Skype appears as a very large bulldozer.

Posted by Ben McConnell on February 11, 2004 | Permalink

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