Evidently the folks managing eBay do not share my assessment of the voice over IP market, because they have gone ahead and offered $2.6 billion for Skype. Half of this is in cash and the other half is in stock, and according to this piece in MarketWatch the final purchase price could be as much as $4.1 billion should Skype meet certain performance targets.
I’m not going to continue to belabor why I really don’t think Skype is worth all that, but rather point to a source that could be said to disagree with me. This article from Lightreading references a voice over Internet traffic analysis conducted by the firm Sandvine to claim that Skype accounts for nearly half (46.2 percent) of the voice over Internet minutes used in North America.
Sandvine claim to have concluded this by monitoring traffic on cable and DSL broadband networks. I’m not sure that’s necessarily the best methodology, because I would be concerned that PC to PC calls would likely be counted twice– once at each end of the call, while PC to phone calls (such as SkypeOut or Gizmo’s Call Out function) and voice over Internet phone to traditional phone calls (such as those offered by Vonage or AT&T CallVantage) would only have those minutes counted once. Somebody could argue that its appropriate to count the minutes on both end of a PC to PC voice over Internet call as VoIP minutes, but if so PC-to-PC clients are always going to have a 2-for-1 advantage. I would argue back that VoIP to PSTN callers should be given odds if this is to be a fairly-measured horse race if we count those PC-to-PC calls at both ends.
If I had more time I would be doing a LOT more analysis on the figures Sandvine are quoting as well. I don’t take them at face value, and I’m curious to know how their final determinants of total VoIP minutes consumed in North America compare to other estimates of same. Also, I’m always a little wary of the vaguer “North America” over the names of specific nations included. I’ve seen too many analysis firms use fuzzy regional designators to be satisfied with that. I will concede that Sandvine probably are more specific in their actual report, but not all firms are specific and many play games like this to avoid direct comparisons of their work to other firms. Even the relatively straight-forward sounding “North America” is rife with considerations about whether or not Mexico, Central America or the Caribbean islands are included.
Do I even need to make the point that minutes are one thing but dollars are something else altogether, or has this late 1990s retro fad taken such hold in business that we once again believe that revenue doesnt matter anymore?
