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May 20 2011

Four short links: 20 May 2011

  1. BitCoin Watch -- news and market analysis for this artificial currency. (If you're outside the BitCoin world wondering wtf the fuss is all about try We Use Coins for a gentle primer and then Is BitCoin a Good Idea? for the case against) (via Andy Baio)
  2. Time Capsule -- send your Flickr photos from a year ago. I love that technology helps us connect not just with other people right now, but with ourselves in the future. Compare TwitShift and Foursquare and Seven Years Ago. (via Really Interesting Group)
  3. HTTP Archive Mobile -- mobile performance data. The top 100 web pages average out at 271kb vs 401kb for their desktop incarnations, which still seems unjustifiably high to me.
  4. Skype at Conferences -- The two editors of the book were due to lead the session but were at the wrong ends of a skype three way video conference which stuttered into a dalekian half life without really quite making the breakthrough into comprehensibility. After various attempts to rewire, reconfigure and reboot, we gave up and had what turned into a good conversation among the dozen people round the table in London. Conference organizers, take note: Skype at conferences is a recipe for fail.

May 12 2011

What did Microsoft get for $8.5 billion?

SkypeIt's the kind of deal that really gets the tech world buzzing — one titan buying another for an astronomical amount — and the question on many people's minds now is what is Microsoft really getting for its $8.5 billion purchase of Skype?

From a technical perspective, it seems a little suspect. After all, Microsoft has already developed much of the same functionality that Skype provides. Windows Live Messenger offers free instant messaging and voice and video chat, it already works with Lync and Office, and Microsoft had previously announced plans to integrate Messenger into Windows Phone.

From a financial perspective it doesn't look much better. Even though Skype is a massive (and disruptive) presence in Internet communications, it has never been very profitable. Last year Skype had $860 million in revenue, and a net loss of $7 million, according to its initial public offering filing. Forrester Research analyst Andrew Bartels told MSNBC:

It doesn't make sense at all as a financial investment. There's no way Microsoft is going to generate enough revenue and profit from Skype to compensate.

So why would Microsoft pay so much for a company that doesn't have vastly superior technology or great financials? As far as I can tell, there's five reasons:

1. Skype's user base

Skype has a strong and loyal base of more than 170 million active users across multiple platforms. Microsoft will get instant access to Skype's network, which represents a huge influx of customers and a big leap in Microsoft's presence as a consumer Internet company.

2. Skype and the enterprise

Of course, it's not all about consumers. Skype has been aggressively pursuing the enterprise market in recent years and has made some solid progress there. Microsoft likely sees this purchase as a win for both its consumer and business product lines, and we can expect to see Skype integration coming soon in all manner of Microsoft products and platforms. Already promised is Skype support for Xbox (and Xbox Live), Kinect, Office, Lync, Outlook, Hotmail, and Windows Phone.

3. Windows Phone integration

Along those lines, perhaps the most obvious outcome will be Skype's integration into future versions of Windows Phone. This will allow Microsoft to compete squarely with Apple's Facetime and Google Voice. Expect to see Skype on a Nokia Windows Phone in the near future.

4. International long distance

Interestingly, one of Skype's biggest strengths was barely mentioned in the press conference announcing the deal: the massive amount of minutes Skype users represent on the public telephone network. Skype's been in an all-out war with the entrenched telecom carriers since its inception — the carriers despise Skype and rightly see it as a major threat to their business model. According to Alec Saunders, a telecom vet and ex-Microsoft employee, with this purchase Microsoft instantly becomes the world's largest carrier of international long distance minutes. How Microsoft will take advantage of this, and what impact it will have on their existing carrier relationships, is one of the open questions around this deal.

5. Blocking the competition

Let's not forget another angle that surely motivated Microsoft to pursue Skype — keeping it away from the competition. It's been common knowledge that Skype's investors have been looking for a buyer for some time. Skype was on a rocky road to an IPO, and it sounds like the investors who bought Skype from eBay were concerned about the viability of that process and eager to get their returns sooner rather than later. When Google came to the table, you can bet the deal-makers in Redmond started some serious number crunching.

Reports are surfacing that Microsoft may have paid much more than they needed to get Skype. Anonymous sources close to the negotiations have said that Google came in second place in the bidding at just $4 billion. That's a huge difference and it certainly suggests that Microsoft could have gotten Skype for much less. But some believe Google was never a serious suitor in the first place, and their interest may have been mostly about trying to keep Facebook from getting Skype.

As Microsoft is feeling pressure from the likes of Google and Apple, especially in the mobile space, the idea of a competitor getting their hands on Skype (and their network) was surely something Microsoft wanted to avoid. Microsoft is already seen as playing catch-up in the mobile space, and if Google got Skype that would put them even further behind.

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May 10 2011

Skype vor Window Live Messenger

Microsoft kauft Skype für 8,5 Milliarden US-Dollar. Grund genug, um die Marktanteile auf unserer Seite des Atlantiks zu betrachten. Skype führt vor Window Live Messenger, dritter ist icq. Die Angeboten von Yahoo und Google sind deutlich auf Platz 4 und 5.

April 27 2010

The military goes social

For most of the 20th century, a soldier in the field could only communicate with his/her family and friends via letters that might take weeks or months to make their way to the recipient. But as the battlefield goes high tech, so has the ways soldiers can talk to the outside world.

Managing how social media interacts with the military is the job of Price Floyd, Principal Deputy Assistant Secretary of Defense for Public Affairs. Floyd, a speaker at O'Reilly's upcoming Gov 2.0 Expo, discusses how the public face of the military is changing in the following interview.

The role of the Public Affairs office:

Price FloydPrice Floyd: We're responsible not just for external, but also internal communication. There's about, depending on how you count it, 2.5 million members of the Defense Department at large, all of the civilian employees, contractors, the men and women in service. And if you count those who retired and their families, it comes to about 10 million. Then there's the external audiences that could be U.S. and foreign-based.

How social media is being used by the Defense Department:

PF: At the Defense Department, what we have done is embraced social media, and the technology behind it, to engage with all our audiences. That's everything from veteran's groups to foreign publics to people who follow me on Twitter. And it's a two-way engagement. The idea that social media is a better way to reach a broader audience with our message, that kind of one-way communication idea, is not what we want to do. We want to engage with our audience, all of them, on the whole host of issues and policies that we deal with.

Does social media mean losing control of the message?

PF: I think that we need to become much more comfortable with taking risk, much more comfortable with having multiple spokesmen out there, thousands of spokesmen in essence. But, for me, there's nothing more credible than the men and women who are out there on the front lines fighting the wars that we're in to send messages back to their family and friends. As you know, you send a tweet or a make a post on Facebook, it doesn't necessarily stay there. That could be forwarded around. Other people that you never thought could see it will see it, even the media. And I'm okay with that. I'm okay with us no longer controlling exactly what people say to the media and then trying to work with the media to make sure they get their story exactly the way we may want it.

The trade-off between open communications and operational security:

Gov 2.0 Expo 2010PF: This is not a new problem. What's new about it may be the number of people who may see information they're not supposed to see because of the ability to communicate to a bigger group of people than you could in the past with a letter. Now it's Twitter or Facebook or YouTube or MySpace, whatever social media outlet they're on.

But Operational Security, OPSEC as we call it here, concerns are still around. We still need to worry about them. We still need to focus on them. We still need to educate to them. We have a campaign here called Net Smart. A lot of that is how to use social media responsibly. With this technology, there are benefits, but there are responsibilities, obligations by the users. You need to remember OPSEC. You need to know that people are watching, reading, and listening all the time. And don't say or do anything on these social media platforms or sites that you wouldn't say or do in front of your boss or your grandmother. It seems like common sense stuff, but it's stuff that we need to educate to the force and we're working to do that.

How the Department of Defense uses social media as a communications tool:

Price Floyd: We have it, but who wants to follow the Defense Department Facebook page? I'm not sure that's the best way to do it. I think what's better than that is to follow a person. Like Chairman Mullen on Twitter or your unit commander's Facebook page. It's personal. You know who it is.

I think people who follow certain bloggers follow them because of that blogger's insight, the way they frame issues. It's not an institution. It's a person doing it. So they build up a relationship. I have about 2,700 followers of my Twitter site. That's not that big compared to some. The Chairman's is much bigger. But I engage with them back-and-forth everyday.

The thing about this, it's not an institution doing this. It's about thousands of people in the institution doing it for us. Since we're so big, thousands of Facebook and Twitter accounts, thousands of MySpace accounts.

What social media will bring to the military in the future:

PF: What actually excites me is the possibility of the unknown. In other words, people being able to do things they've never done before. Just in the last year or so, as we were looking at this policy review on social media and whether to have a policy of open or closed or something in between, I heard stories from the men and women on the front lines, and I learned things I didn't know were going on. Mothers and fathers on the front lines doing homework with their children back home in real-time. It's just amazing, all of the ramifications that may come from that. Transitions could become easier because they weren't completely gone; the kids still saw dad or mom once or twice a week through Skype.

The technology today has changed the way the men and women overseas are able to communicate back home with their family and friends. I don't know what's going to come next, but if past is prologue, there will be both risks and benefits to it. And we need to accept that and try to responsibly deal with it.


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