Video calls - Skype vs Lync vs WebRTC
Microsoft made a splash back in 2011 when it bought Skype for $8.5bn, but was it a short-sighted move?
Back then, Skype had a solid operating profit of $264m. Althought it still sells subscriptions for calling-out to standard phone networks, it has since removed its Premium product. The great news for us is there's no longer a restriction on the number of concurrent users in group video calls.
But video calls have become commonplace over the past few years. From Apple's Facetime to Google/Android's Hangouts, it's a facility users now expect for free. So it's getting tougher to drive any revenue from Skype. Add Microsoft's own Lync video-conferencing Office application into the mix, and Skype suddenly looks almost redundant.
Furthermore, a new standard called WebRTC is allowing developers to embed real-time video communications directly into the browser. It has already been adopted by Chrome, Firefox and Opera. But not, funnily enough, IE.
It may well be that Skype's real value lies in its userbase. Microsoft hasn't the best record when it comes to marketing, so it will be interesting to see how it transistions and monetizes Skype's 79million concurrent users.