Source of Skype Growth

Borderless Communicator Hudson Barton has spent the last few years as the “keeper of the ‘real users’ statistic”, a measure of Skype usage that attempts to understand the demographics of Skype’s user base and put it into some sort of perspective so that it can be compared with other communication services.

There are only five public statistics provided by Skype in their reporting. First is the number of users online in the lower right corner of the Skype client. With each eBay quarterly report we get to see gross revenue generated by Skype, the cumulative number of Skype accounts opened as well as minutes of Skype-to-Skype calls and minutes of SkypeOut calls.

I have posted a couple of times about the fallacy of the cumulative number of Skype accounts as it gives no indication of “active” Skype usage over, say, the last quarter or, expressed more succinctly, how many accounts were really used for a Skype call of any type in the previous quarter? It’s based on stale data; this particular number ranks right up there with “how many hamburgers sold”.

However, by tracking the number of users online several times per day over the past few years, Hudson feels he has gained some perspective on Skype’s growth.

Sources of Skype Growth
by Hudson Barton

A question was raised the other day that the raw “real user” statistic could not adequately answer. That question was “Is Skype growth coming from new users or from changes in the pattern of Skype use?” So here is a deeper analysis that answers what the raw “real users” statistic fails to fully capture.

In 2005 and 2006, the amplitude of the daily usage wave was growing.   That is to say, the daily highs were growing relative to the lows (after discounting regional distortions)… 10% per annum faster in fact.  Skype usage was increasing in the middle of the workday relative to off-peak hours.  People were not using Skype as a general communication utility for inbound and outbound calling and presence.  Rather, they appear to have been using Skype for special work-related purposes like outbound long distance calling to save money.

In 2007 and 2008, the trend reversed.   The amplitude of the daily usage wave started shrinking.  The lows have been growing relative to the highs … 20% per annum faster.  It appears that people began using Skype for normal, essential and basic communication, staying online for longer stretches of time or even around the clock in order to receive inbound calls and to mark their presence.   Although we don’t know the precise motivation for this change in behavior, it could be related to the expanding availability of unmetered broadband.  Electricity is the only variable cost associated with keeping your Skype device running 24/7. So the trend is mostly due to a broadening of American and European usage…. folks in industrialized countries are staying in the Skype cloud around the clock with either computers, mobile devices or proxies such as iSkoot.

Today, the peak of the Skype usage wave is at about 14.5 million and the trough is about 7.2 million (out of 36 million total “real users”).  The comparable graph for a “phone” company (or a VOIP operator like Vonage) would show a usage wave with an amplitude of zero; all users are by definition online all the time.   If Skype’s usage trends continue, it will begin to look more and more like an indispensable communications utility and less like a mere disruption to the communications status quo.

About Jim Courtney

Bringing over thirty years' experience in the sales, marketing and management of cutting edge technology businesses.


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