3 UK to make Skype calls completely free

Reply from dean on Apr 28, 2009 - 02:15 PM

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Actually they aren't making any money at all

As you point out:-

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Losses at the group, which hit £1.4 billion five years ago, were reduced this year to only £152 million

I'll say again:-

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They're saying they make more money giving Skype away for free, full stop.

Reply from andyk on Apr 28, 2009 - 03:37 PM

So you're implying that perhaps nothing else has changed and that free Skype might earn them £1.25 billion?

So far, the totally free Skype offer hasn't even started, so it's impossible to support any conjecture about its results

If I bother to use it, it will earn them about 0.1 to 0.15 penny per phone call to landlines

Reply from dean on Apr 28, 2009 - 04:06 PM

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So you're implying that perhaps nothing else has changed and that free Skype might earn them £1.25 billion?

You're missing the bigger picture. I'm saying it doesn't matter. The point is most mobile operators don't get concepts like "give something away for free, make more money".

Forget 3. Pick A. N. Other operator.

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If I bother to use it, it will earn them about 0.1 to 0.15 penny per phone call to landlines

Then no-one wants you as a customer. You're part of the overhead. If every customer was like you, they'd all be bust by now and no-one would have a mobile phone.

Reply from ianplain on Apr 28, 2009 - 05:06 PM

Hi

OK do you use 3 ? if you do then you probably have a skype enabled phone. so you will know that the allowance at the moment is 4000 odd mins with a £10 a month top-up for a PAYG customer or contract.

This deal has been running for some time so they will have a VERY good idea of usage patterns. Me for example make the odd call on my 3 mobile but for the most part use it for skype calls.

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£1.4 billion five years ago, were reduced this year to only £152 million.

this is called making money, to increase revenue by over £1.2 billion in five years is damn good going. You are mistaking profit with revenue
++





Ian

Reply from andyk on Apr 28, 2009 - 05:57 PM

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You're missing the bigger picture. I'm saying it doesn't matter. The point is most mobile operators don't get concepts like "give something away for free, make more money". Forget 3. Pick A. N. Other operator. Quote: If I bother to use it, it will earn them about 0.1 to 0.15 penny per phone call to landlines Then no-one wants you as a customer. You're part of the overhead. If every customer was like you, they'd all be bust by now and no-one would have a mobile phone.

Actually, perhaps it's you who has missed the bigger picture

Other networks are offering free internet to help move people up to higher-tariff mobile contracts, while 3 gives Skype unconditional of any need to spend money at all

So a year ago, I could have been tempted by a mobile broadband deal from 3, as it was perhaps the cheapest, but now there is little point in a separate mobile internet deal

Amongst UK networks, O2 has increased customer numbers the most in the last year or two, partly due to the iPhone, partly due to innovative contract deals such as Simplicity and the aforementioned inclusive internet, both of which others are now copying, and also cheaper roaming - they undercut the Eurotariff a year before it was introduced, and introduced an add-on option of free incoming calls in Europe even earlier, over 2 years ago.

Compare the last part to 3's statement of its keenness to drive down roaming tariffs, which took in the author you linked to, and may be seen as rather odd when it's the only network which has actually increased prices recently.

And there are several other providers promoting cheap or giveaway offers involving their compatibity with Skype. The problem with VoIP is that it doesn't necessarily build customer loyalty, and people can churn easily when their prepaid account sinks to £1 and they switch off or forget to update the automatic recharge. 3's offer may work, but it's up against others.

That's why I only mention that possibility of zero-cost landlines via Skype, rather than will do it. I had a free landline with a slightly complicated forward to a Skype account nearly 3 years ago (and it was better quality than SkypeIn). But now, with more sophisticated phones running Fring or other clients, or with other provider landline numbers to point to Skype accounts, people can find more ways to make Skype calls via any network.

Yes, 3 will attract people, but when something is very cheap or free they may assign less value in their minds, and find it easier to look around and drop it. Facebook on a mobile, any number of other latest-vogue social websites or pseudo-IM clients swapping messages via data without chargeable sms, these are not unique to 3 either

Reply from andyk on Apr 28, 2009 - 06:05 PM

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... so you will know that the allowance at the moment is 4000 odd mins with a £10 a month top-up for a PAYG customer or contract. This deal has been running for some time so they will have a VERY good idea of usage patterns. Me for example make the odd call on my 3 mobile but for the most part use it for skype calls. Quote: £1.4 billion five years ago, were reduced this year to only £152 million. this is called making money, to increase revenue by over £1.2 billion in five years is damn good going. You are mistaking profit with revenue ++ Ian

Did you spend all of that £10 a month on those odd calls?

If not, you now have the opportunity to save money

Have you looked up 3's accounts? I have not.

Unless one of us does, you may be mistaking increased revenue with decreased costs. It's probably a mixture

Reply from ianplain on Apr 28, 2009 - 06:20 PM

Im not PAYG I have a contract and a separate data contract(dongle and wifi router), and combined they are a very cheap package that gives me my data and skype voice , combined with my iphone on 02 it allows mm comms where ever I am.

I don't look for or need the cheapest I need reliability and features and am very happy to pay for that.

Ian

Reply from dean on Apr 28, 2009 - 06:25 PM

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while 3 gives Skype unconditional of any need to spend money at all

And achieves a higher ARPU.

Bottom line difference to a mobile operator is (1) ARPU, and (2) cost of customer aquisition.

You're talking about what you want and how you react to packages. The mobile operators only really care about mass market averages.

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I had a free landline with a slightly complicated forward to a Skype account nearly 3 years ago (and it was better quality than SkypeIn). But now, with more sophisticated phones running Fring or other clients, or with other provider landline numbers to point to Skype accounts, people can find more ways to make Skype calls via any network.

You summarise that nicely and it is indeed "slightly complicated". That maybe fine for you, but it just doesn't fly with the mass market.

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but when something is very cheap or free they may assign less value in their minds, and find it easier to look around and drop it.

But they don't look around and drop it. That's early adopter/technophile technique. Look at Skypes rate of aquisition of iPhone customers.

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pseudo-IM clients swapping messages via data without chargeable sms

Not currently mass market products. Skype is the only one that has so far achieved mass market appeal and adoption.

Reply from andyk on Apr 28, 2009 - 08:29 PM

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Im not PAYG I have a contract and a separate data contract(dongle and wifi router), and combined they are a very cheap package that gives me my data and skype voice , combined with my iphone on 02 it allows mm comms where ever I am. I don't look for or need the cheapest I need reliability and features and am very happy to pay for that.

could you get by with a different phone on O2, use it as a modem, run Skype on it, without necessarily any need for wi-fi ...

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You're talking about what you want and how you react to packages. The mobile operators only really care about mass market averages.

No, I'm not. You've edited out part of what I mentioned, which is hardly esoteric. But it is how O2 have gained nearly 2 million customers in 2 years, cut churn to very low levels, and became the largest UK network.

Reply from ianplain on Apr 28, 2009 - 08:37 PM

Hi

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could you get by with a different phone on O2, use it as a modem, run Skype on it, without necessarily any need for wi-fi ...

maybe mabe not, But I like the iphone it does what i need from a business phone. I use 3 for data as it also does what I want.

I dont need to worry about the cost and I need the tools.

If for example I could "fudge" about to get things sort of working any cost savings would be outweighed but the cost of the time it cost me to get it working, and also I always alternative methods of connection.

Its not all down to cost in business, reliability is far more important.

Ian

Reply from andyk on Apr 28, 2009 - 09:11 PM

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If for example I could "fudge" about to get things sort of working any cost savings would be outweighed but the cost of the time it cost me to get it working, and also I always alternative methods of connection.

You guys quite like patronising people, don't you?

Yes, I understand an iPhone can't be used as a modem, and software to do so was only published by Apple for a few days and then removed, but that does not mean other phones can't.

Actually, connecting a phone to a laptop is quire easy, no fudge needed, not much time, not even any ironic inverted commas.

You know what a USB socket is? Those thoughtful phone manufacturers send you a lead which plugs into it. And a CD of software for easy installation. Or you can download from their website.

Reply from ianplain on Apr 28, 2009 - 09:36 PM

Hi

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You guys quite like patronising people, don't you?

No we use this technology day in and day out here and abroad as a part of business. Yes of couse I know I can use a mobile phone as a modem, but much better to use a dongle with a data package. I also need to be on the phone while remotely connected to a users site, and often Im not the only person who needs access when setting up a site. Hence the need of a 3g router with wifi connectivity.

As I said cost doesn't even enter into the equation. It has to do what I want when I want it to.

Ian

Reply from satphoneguy on Apr 29, 2009 - 05:13 AM

it will be interesting to see if we start to see a bunch of simply to use/setup skype gateway service's that specifically target 3 skype users.

one that comes to mind that seems so logical would be services that offer free inbound subsidiesed DID's(such as the ones voipusers offers) to all start offering free forwarding to skype. this would drop the cost for inbound calls down to landline levels; assuming they offers 0844/0845 numbers and not only the expensive 070 ones. or how about a service that fowards calls to skype from 070 numbers and gives back credits for calling card services that can be accessed via a skype gateway? or for that matter it would not surprise me if calling cards in the UK start offer skype as a way to access their platforms.

Reply from dean on Apr 29, 2009 - 08:57 AM

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could you get by with a different phone on O2, use it as a modem, run Skype on it, without necessarily any need for wi-fi ...

Do you mean tether the phone to a laptop and use it for mobile data? It might be the right thing for you, and I know it would work, but I'm not sure it's a practical solution for the mass market. It's a bit clunky, certainly when compared to just a phone.

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it will be interesting to see if we start to see a bunch of simply to use/setup skype gateway service's that specifically target 3 skype users.

Interesting thought. So free mobile leg, dial through to something else.

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one that comes to mind that seems so logical would be services that offer free inbound subsidiesed DID's

That might be something that we could do using 0845 and forwarding to Skype by mapping to an +883 iNUM.

Reply from andyk on Apr 29, 2009 - 10:00 AM

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Do you mean tether the phone to a laptop and use it for mobile data? It might be the right thing for you, and I know it would work, but I'm not sure it's a practical solution for the mass market. It's a bit clunky, certainly when compared to just a phone.

#
It's a bit less clunky than having a 3g/wi-fi router, though that is of course useful for a group of users, as Ian explained in the end

For occasional use, or even regular, it's potentially one contract and piece of hardware less.

Last year I thought for a while about getting a 3g wi-fi router, partly on the excuse of a trip abroad by a group. When I mentioned it to 2 or 3 of them, they didn't seem that bothered; there was wi-fi and plenty of wired connections around the buildings at the daytime venue though. Also, the Vodafone Germany flatrate data tariff only improved after we got back. Since discovering that modem use is possible on my phone, and more importantly that the fair use policy was ok, I've gone cool on a router or a mobile broadband contract.

Phone use and connection to the laptop (by lead or bluetooth) aren't mutually exclusive. If the phone rings, it can still be answered. But yes, if I was doing it for several hours a day, the picture could be different; the phone battery life is one issue, and I bought a USB charger lead; that could become a pain for some people.

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