Looks like the doom and gloom about Skype's future is gaining more momentum. After my “Skype's Losing It” post earlier week looking at the political, regulatory and business threats to Skype, Om Malik has weighed in today with a post focused on employee defections (hat tip to Andy Abramson)
and the “changing culture” at Skype now that it is no longer
fast-moving rebel but a target of regulators and competitors. I sat
down today with Iotum's Alec Saunders and Howard Thaw
(their relevance engine looks very attractive to revenue-starved
carriers), and we agreed Skype appears to have lost its raison d'etre
and momentum. Maybe eBay will get Skype back on track after the
acquisition is digested but eBay doesn't have much time given Google is
quickly moving into the click-per-call market.
With a $4.1-billion bet on the table, eBay needs to come up with a
pro-active strategy for Skype or risk having it end up as an expensive
and misguided strategic mistake.
Google's Dominance, Dipsie's Plans
Earlier this week, I wrote a column in the Financial Post
exploring the idea about whether a new rival to Google in the search
market could emerge. My take is it's unlikely unless a company develops
kick-ass technology and has the financial backing to build a global
brand, large user
base and, as important, the back-end infrastructure. An interesting
angle
in the search story is Dipsie,
which initially wanted to go head-to-head with Google in the mainstream
search market but has decided – at least for the time being – to focus
on the deep search market (data hidden behind firewalls and databases).
You can read my column here. SiliconBeat has some more details on Dipsie as well.
Tucows Looking for Love
Canada doesn't have too many exciting dot-com plays – perhaps
because investors up here tend to be conservative by nature, which makes the Internet a very scary place. That said, Tucows Inc.
stands out because it's based in Toronto and it's the fourth largest domain
name supplier in the world. (Makes me want to belt out a rousing rendition of “Oh Canada”). The company gained a big supporter earlier this year when Mark Cuban acquired an 8% stake. This is Cuban's second stab at a Canadian dot-com. His initial foray – Mamma.com Inc.
- ended rather inauspiciously when Cuban abruptly sold his 6.6% stake after taking issue with a private equity offering
done by Mamma. It probably didn't help that Mamma is being investigated
by the SEC. Anyway, I'm digress. Tucows picked up analyst coverage -
well, one analyst – after long-time shareholders decided to unload 22
million, or about 30% of the company, three months ago. One of the reason that Desjardins Securities
analyst David Shore is bullish on Tucows because of its Blogware blog publishing tool, which competes against TypePad,
Blogger, etc. What makes Tucows interesting is it doesn't sell
directly but through a 6,000 network of ISPs and Web hosting
companies. The stock is selling for less than $1 a share, which means
Cuban probably spent his daily per diem on his stake. For more details
about Tucows, check out my story in today's Financial Post.
Getting Played By Microsoft
I
saw a photograph in a newspaper yesterday in which Bill Gates was
handing out the Xbox to a customer (white geek-looking male wearing
glasses and a bad hat). The photograph and Gates' decision to
personally hand over
the first Xbox is just more evidence of Microsoft's brilliant and
well-executed marketing campaign. In many ways – be it leaks,
“frank” discussions with major business publications or reports Xbox is
already sold out (easy to do if you decide to “manage” the
shipping process) – Microsoft has convinced the media and
consumers the Xbox is a revolutionary product that is not only going to
shake up the gaming industry but jump-start the company's growth
prospects. In many respects, Microsoft has no choice but to put its
marketing machine behind Xbox because it's not like the new version of
Windows or Office 54 is going to blow away investors and consumers.
Xbox is about buzz and sizzle, which Microsoft desperately needs more
of. From a financial perspective, I'm not sure how much weight to put
on a research report by iSuppli, which suggests Microsoft is losing
$153 on every Xbox sold based on the cost of the components vs. the
$399 retail sales price. If you're as big as Microsoft, you are likely
get
big volume discounts. Then again, the action is probably not in
hardware but the
software needed to use the new Xbox: it's the old razor and blades
game. In any
event, the fact I'm writing this post on Xbox just demonstrates
how even the skeptics (and non-game players) out there have been caught
in the Microsoft PR machine.
Google Holiday Party
Sometimes, it makes little sense trying to cover
the
high-tech world when you're not living in the centre of the universe
(Silicon Valley). I was reminded of this harsh reality after getting an
invite
to Google's holiday party for the media next month where apparently you
can enjoy
a “good conversation” – off the record, mind you – with Eric,
Larry
and Sergey. I have a funny feeling my Silicon Valley-envy with get even
worse later this week after we get 15cm of snow. Have a drink for me at
the party, Om!
Update: One thing I'd be
interested in chatting with Larry and Sergey about is Google's
click-to-call “test” where you can click on a telephone icon and
be connected with an AdSense advertisers. Greg Yardley has all the
details here as well as Google's FAQ. Here's some screen shots pulled off the site. 
You wonder how eBay CEO Meg Whitman feels about having to Google's foray into the CTC market?!
A Google Brower? Possible but Unlikely
I had an interesting conversation today with Opera CEO Jon von Tetzchnerabout a variety of topics. Among them was whether Google could
launch its own browser, which seems entirely possible given
how the company is dabbling in everything from blogging to maps to
keep its growing army of PhDs engaged. von Tetzchner said Larry Page and Sergey
Brin have told him Google isn't working on a browser, although the
company is apparently offering technical support to Mozilla.
von Tetzchner said Google has much more to lose than gain by moving
into the browser market because it has Opera and Firefox has
key allies to drive traffic to Google. “If they
go out and make their own browser, they would lose that kind of
friendship,” he said. From a big picture perspective von Tetzchner said the desktop browser market is
far more interesting than it has been for the past few years because there
is so much innovation happening at a time
when Internet Explorer is under attack. “The fact
IE is losing market share to Firefox and to us is a very positive thing
and bodes well for more interesting Web features because things are not
held back,” he said. “The fact IE7 is coming out with improvements in
the core engine is good for everyone.” In the name of transparency, I
used to be a big-time Opera user several years ago but have switched
to Firefox about nine months ago – even though Opera sports many of the same features such as
tabbed browsing. (As a techie, I like the fact Firefox can be easily
customized with extensions.) But after talking with von Tetzchner, I'm
going to give Opera another crack. By the way, he said downloads are
running at two million to three million a month after Opera decided to offer its browser for free – double what they were when Opera was selling $39 and ad-sponsored versions.
