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Skype Explained Visually

What is Skype?
Skype is an application that allows people to make free calls over the internet via Skype-to-Skype, but it also allows people to make calls to landlines for a low cost. With Skype, people can participate in IM chatting, and video chatting (Skype). Many businesses use Skype as a means of advertising because Skype offers “Pay per Call advertising,” which is one of the best ways for big and small businesses to advertise on Skype (Skype). Skype has over a million users that are on their website every day. Therefore, the people that are on Skype are given the opportunity to locate different local businesses in order to find exactly what they are looking for at a given moment. Oprah Winfrey uses Skype as a means of communicating with guests from her show. In fact, Skype is a paid sponsor of the [[ |Oprah Winfrey show]] (Skype).

Reasons for Using Skype!video_shot.png
Skype is a great place for companies to advertise because it used by many people. There are millions of active users at any given time period on Skype (Skype). In 2007, Skype had around 198 million customers (Plunkett’s Advertising and Branding Almanac 2007). Pay per Call advertising is a successful alternate form of advertising for businesses. Skype has paired up with AT&T Interactive Advertising Network (Skype). SkypeFind is sort of like a giant phone book for people that are using Skype. Members of Skype recommend and review businesses and those businesses are added to the community site (Skype). With Pay per Call advertising, a phone call is the means of communicating with the company. Pay per Call advertising, is an upgraded paid search (Marketing the E-Business). It is more personal based advertising because people speak directly with the business they are looking for; therefore, their questions get answered immediately. When a company funds the advertisement, the words free call are displayed near the phone number; however, if a business does not fund the call, Skype customers can still contact the company via Skype, but they must pay a low cost (Skype). The Pay per Call advertising is a major convenience for advertising companies. The service is located with the internet, but the business is transacted through the phone, therefore, the advertisers do not need to have a website (Marketing the E-Business). Skype is extremely popular in European countries; they have a partnership with European Directories. According to Don Albert, the GM and VP of Americas and Advertising for Skype, “When a call is free and only one click away, we believe it can have a positive impact for a business because there are fewer barriers to start a call. That can result in more qualified leads, more engagement, and possibly a higher rate of conversion for a business” (Skype). Pay per call advertising is an excellent way for advertisers to showcase their businesses on Skype because it is easy to find, and helpful for consumers. Cornel Riklin, the CEO of European Directories said, “The new Skype ‘Free Call’ button will turn search for businesses into calls and leads for businesses. It will make our advertisers stand out from competition everywhere on the Internet, including in search engines” (Skype).

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Limitations of Using Skype

As with any media, there are limitations. Even though millions of Skype applications have been downloaded, it does not mean that all of those people are on Skype at any given moment. However, if they are online at the time, the users may be seeing the advertisements, but that does not mean they are truly absorbing those ads. There are also security concerns with Skype, which could limit the amount of advertising that people are seeing because they are avoiding the application (Master New Media 2006). Ross Armstrong, a research analysis for Info-Tech, says, “The bottom line is that even a mediocre hacker could take advantage of a Skype vulnerability” (Fasig, Nicole Price 2006). That is a major limitation with Skype. Having a vulnerable application makes people less likely to view ads because they are not always taking full advantage of it.

Costs Associated with Skype

There are costs associated with Skype. Most of Skype’s features are free for people to use, but not all of them. Some of the free features are Skype-to-Skype calling transferring calls to people on Skype, video calls, instant messaging and group IMs, conference calls, and forwarding calls to people on Skype (Skype). However the pricing for, calling phones and mobiles, forwarding calls to phones, and transferring calls to phones and mobile begins at $0.021 per minute (Skype).. Sending SMS messages start at $0.047 (Skype). For consumers to really utilize the Pay per Call advertisements, they must initially pay to use the Skype application. That is a big cost to the advertising companies that run their ads on Skype because not everyone will see or use them.




Skype has a reach of over 100 million people (Master New Media 2006). Many people view and utilize the Pay per Call advertising on Skype because they see it throughout the day. Another good quality about Skype is that it is available all of the time. Companies can always advertise on Skype because it is constantly running.

Audience Qualities of Skype Users

When Skype first started out as a new company, the typical user was 18-38 year old men (J.D. Lasica 2004). Now, Skype has catapulted into quite a phenomenon. Young children now use the application. So do grandparents who want to interact with their families (J.D. Lasica 2004). Skype is very easy to use. It now has users from every demographic imaginable. It is very popular among businesses. In fact, Skype even has a version especially made for business executives (Worldwide Computer Products News 2009). Out of Skype’s users, around 35% use Skype strictly for business purposes (Techweb 2009). Businesses have begun replacing conference calls with Skype calls because it is easier and more personal than the boring old conference call. Business executives are able to visually see the people they are speaking to. That way, they know if they are being sincere and what kind of business they are getting in to by being able to see facial expressions and gestures.

Partners of Skype


Many companies have partnerships with Skype and do advertising on Skype. Ebay at one time bought Skype in a billion dollar buyout in order to utilize the Pay per Call advertising. The Pay per Call advertising was to be used for buyers who wanted to communicate directly with the seller. Ebay CEO Meg Whitman said of Skype that it, “will lead to a better experience and increase the velocity of trades” (USA Today 2005). Unfortunately, Skype never took off with Ebay buyers, and Ebay is in the midst of selling Skype (Business Week Online 2009). Skype does still maintain partnerships with Oprah, Myspace, and Yellow Pages just to say a few. MySpace is one of the big partners with Skype. Through the partnership, MySpace members would be able to communicate with other MySpace members through Skype for free (Business Services Industry 2007). Michael Van Swaaig, interim CEO of Skype says of the partnership, “Both MySpace and Skype have become part of people’s lives by bringing people closer together, no matter where they live in the world. This partnership reiterates that Skype is the platform of choice for Internet communications because we make it simpler and easier for people to place free calls to one another whether they are on Skype or within the MySpace network” (Business Services Industry 2007). The partnership is a wonderful chance for advertisers to reach a whole different realm of consumers. If companies are interested, they can sign up on Skype’s website for their own partnership with Skype (Skype).

Skype for iPhone/iTouch
Not only can you access Skype on your computer or laptop, but Skype has made it especially interesting by allowing you to Skype on-the-go! You can do free Skype-to-Skype calls simply by downloading the app for your iPhone or iTouch. All you have to do is sign into Skype from your iPhone from any WiFi zone. You can also call and text phones with Pay as You Go Credits, or with a subscription you get unlimited calls to Landlines.(Skype)

Skype is a great place for advertisers to showcase their business and services to consumers because so many people have begun using Skype over the past few years. It is different than the traditional form of advertising on television, print, or radio because it is interactive. With Skype, consumers can utilize Pay per Call advertising and talk directly with a business they are interested in. They avoid the middle man. Consumers can now get the one on one attention they have always strived for. Internet advertising takes agencies to a new platform with consumers and consumers live for the interactive aspect.

Works Cited
Fasig, N. (2006). Skype Security Questioned. PC Magazine, 25(1), 22.
Good, R. (2003, November 6). Skype Problems And Limitations. In Robin Good. Retrieved skype_problems_and_limitations.htm
Harris, L., & Dennis, C. (2008). Activity 12.3. In Marketing the E-Business (p. 320). Routledge.
Interop; Skype Looks For More Business USers. (2009, May 20). Techweb (techweb). Retrieved
October 20, 2009, from Lexis Nexis database.
Kevin, M. (n.d). $2.6B deal gets eBay into Internet telephony. USA Today,
Lasica, J. (2004, November 8). Engadget Interview: Niklas Zennstrom. In Social
Retrieved October 20, 2009, from Social website:
MacMillan, D. (2009). EBay's Skype Sale Looks Like a Win-Win. BusinessWeek Online, 1.
MySpace and Skype Announce Partnership Bringing Free Internet Voice Communications to
MySpace Global Community. (2007, October 17). BNET (bnet). Retrieved October 19,
2009, from CBS Interactive Inc. website:
Plunkett, J. W. (2007). Skype Technologies SA. Plunkett's Advertising and Branding Industry
Almanac 2007.
Skype. (2009). Retrieved October 20, 2009, from Skype website:
Link to Youtube
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