SkypeOut Prices Dropped | | Mark Evans TechMark Evans Tech

SkypeOut Prices Dropped

Not sure what to make of this news but Skype has slashed its SkypeOut rates by about 15% to more than 30 countries. SkypeOut, which is marking its first year anniversary, is also being offered to six new countries at 1.7 Euro cents a minute. What's perhaps more interesting is SkypeOut prices to Saudi Arabia, Papua New Guinea, Oman, Lichtenstein and Haiti are climbing – in some cases by more than 100% – apparently due to “increases from our suppliers”. Strategically, I wonder what the price adjustments suggest? Has SkypeOut usage plateaued, and it requires a jump-start to attract more users? Do the price increases mean business is getting a little more complicated now that Skype has to deal with incumbent carriers to connect to the PSTN? Skype says SkypeOut has attracted more than 1.8 million people but it does provide a break-down on metrics such as ARPU or average number of calls per user. For all anyone knows, SkypeOut could be regularly used by only 100,000 people while the remaining 1.7 million people have only used it once.

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Anonymous

If 1.7 million people have bought time at SkypeOut and only used it once then that is very good for Skype's profitability in the short term. I believe the minimum transaction is 10 euros and if they don't use it then Skype doesn't have too anything to get access to the PSTN. That adds up to 17 million euros of profit. Of course in the long term it is not good since these people will never buy time again.
But I think that is unlikley. Many folks are probably like me – I have bought SkypeOut time but I only use it when I am travelling to avoid exorbinant phone rates of hotels. $15/day for high speed internet is a lot more reasonable than $1 every time you pick up the phone plus $$ per minute for LD. I bought time 9 months ago and I have only use up about 3-4 euros in that time.
Jim Courtney

Just for comparison Packet8's rates to Taiwan landlines have jumped 50% (from US$.02 to US$.03) but their rates to wireless phones in Taiwan have decreased by 60% (from $0.30 to $0.11) in the course of recent repricings. On the other hand Thailand's landline rates have dropped from $0.10 last fall to $0.06. Two factors:
1. Rates appear to depend on arrangements with local carriers in the terminating countries and the associated interconnect providers.
2. Outside North America it is the wireless call originator who must pay the wireless call charges, thus wireless rates to, say Europe and Asia) can be multiples of landline rates (this is even true for Bell Canada International rates).
So I would not be too alarmed about Skype's changes; these changes are going to be a fact of life every few months and be under the more general control of what the prices are for interconnection as set by the likes of Global Crossing, Teleglobe and other such interconnect providers in their arrangemetns with the terminating carriers in each coutnry rather than Skype usage levels itself.
The interesting question for Canadians about Skype is whether Skype will be able to get SkypeIn numbers that terminate in Canadian area codes.
(Like the other commenter I use SkypeOut for any LD calls from hotels when travelling. Sure beats carrying around the ATA device for my other VoIP service.)