Skype: Partner or pursuer?

As Skype chief operating officer Scott Durchslag tackled questions at the company's CTIA Wireless 2009 press conference about Skype's potentially delicate relationship with mobile carriers, the inevitable question arose from an audience member: Does Skype want to be a mobile virtual network operator providing its own mobile service to customers? Durchslag gave the predictable answer, which was something akin to no, Skype wants to work in partnership with mobile carriers to support Skype as part of their own services and devices. That's the pat answer that most of the world's Internet giants, including Yahoo! and Google at various time, have given over the last decade when asked if they wanted to become telecom service providers or network operators in their own right.

But, how much longer will we be hearing that pat answer? Last week, Fierce's Doug Mohney [1] talked about the logic of Google bidding on Qwest Communications' long-haul network (rumored to be on the auction block). Google, despite recently expanding its service influence through Google Voice, and also participating as an investor in WiMAX carrier Clearwire and an undersea cable initiative, has yet to immerse itself fully in the network operator world. Though it remains to be seen whether or not Google will do that, there is no reason that it couldn't do it, and as Doug points out, at least a few reasons it might want to do it.

The same is true of Skype, whether you consider the company's possible future as an MVNO, a full-blown mobile network operator or even an owner of wireline network facilities. The company already handled 8 percent of the world's international calling minutes in 2008, according to TeleGeography, and has way more than 405 million users (adding 1 million or so every three days, according to Durchslag's math). Much of Durchslag's press conference last week in Las Vegas was set aside to discuss Skype's desire and willingness to work more closely with traditional telecom service providers. He said there has been progress, though he also admitted such efforts can take a while, and added that Skype will not let its own strategic plans be slowed by slow talks with carriers.

Of course, Skype knows that is the best way to keep its growth pace and reach the broadest possible audience. Meanwhile, it may not want the costs and other headaches of owning and operating a network or offering a complete wireless services package. But, instead, it may often encounter the defensive postures and protectionist philosophies of traditional telecom carriers who are still trying to balance a need for service innovation with a need to slow the progress of some of the service innovators they might partner with to pursue more service innovation. That confusing situation yields progress in fits and starts, and you have to wonder when companies like Google and Skype will finally just grow tired of it. In five years time--or possibly much sooner--will Skype and Google be the telecom world's two biggest partners, or will they be the two biggest full-fledged telecom network service providers on the block, leaving everyone else in the shadows?

-Dan [2]