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Systems MGCR 620 E-Business: Skype and its Impact on the Telecom Industry November 9, 2008 Tomotaka Brink Fushimi [email_address] (260301050 ) Benjamin Carrion Schafer [email_address] (260339078) Tess Hong [email_address] (260332417) Ting Miao [email_address] (260314135) Tom Takahashi [email_address] (260313560)
Using “unused processing capacity of its customers” means Skype can provide a telecom service without high capital expenditures
This means low cost to consumer
A call to Canada
AT&T: US$0.05/min ~ US$0.61/min
E-Business Analysis: Reasons for Success Cost advantage : lower cost structure Easy handling Viral spread being freely downloadable Large community working on compatible solutions for Skype Continuous innovation and expansion of services ( Skype out , Skype In , Video conf .) Agreement with Wal - Mart to sell Skype - certified hardware devices and prepaid cards Partnering with certain computer manufacturers to include Skype Scaling : additional infrastructure is not required
E-business Analysis: Synergies with EBay & PayPal
EBay’s Chief Executive Margaret C. Whitman “We can create an unparalleled e-commerce engine.” [Businessweek 2005]
Lead generation. In addition to paying eBay listing and completed-auction fees, sellers could also pay eBay a fee for getting an Internet call, or lead, via Skype
U se Skype to expand eBay’s moves into new markets, such as new cars, travel, real estate,
PayPal has already embedded its service into Skype payment flows, which can boost Skype's revenues and increase PayPal's payment volume
Skype Send Money, which allows users to send/receive money using PayPal through the Skype client
Communication via Skype allows buyers and sellers to benefit from being able to communicate directly with each other anytime
E-Business Analysis: Risks In August 2007, Skype experienced an interruption for two days The decline knocked $1 billion + off eBay’s market cap. eBay shares closed down 2.58%.