Luis Benavides

Microsoft… A word that causes feelings to every human that uses a computer in this planet. These feelings go from anger, disappointment, a love-hate mixture, dependence, true-love and enlightenment, to a real impotence of doing anything against it. Microsoft is lining its army for the big launch of “Vista”, the new version of the Windows operating system.

Nobody doubts the enormous power that Microsoft has, but there’s one company that has managed to declare a public opposition-competition position and has make it to sustain its menace to the Bill Gates’ guys; it’s called (obviously) GOOGLE. It’s really amazing how this battle is taking place with every-day moves that make it look like a chess game.

Microsoft is known for its monopoly problems in the US, the huge fine of 280 Million EURO by the European Union commission for antitrust. It’s also know for playing dirty with its partners (for example: Netscape) and for establishing hard lock-ins to its customers. It’s a model of capitalist company but it’s playing in “shark-waters”. The objective of this post is to evidence how are this “chess-moves” going and how its main competitor Google is playing too.

Microsoft is always a second mover, is a reactor against pressure. In my point of view, the lack of initiative has been evident since it was created, but their huge power has let it (up to now) literally, to kick away the competence. They have an advertising based business model (or at least moving forward to it) as Google does, and here is what is recently happening:

Google launched the first big threat with the online spreadsheets beta test; and as Google always does, for free. This is a clear battle sign that says: “Hey, this Microsoft Office product you have, I’m going to give it for free”. It was a low punch for Microsoft, who immediately reacted with the launch of “Microsoft Live” that for the moment it only has: the Encarta Encyclopedia, MSN live and Outlook live, and it’s planning in the near future to release an internet based office.

Vista is intended, as in other Windows versions, to include embedded the Microsoft explorer with new functions similar to the Firefox, in order to recover audience. Bad move! – This plays against many companies such as: Mozilla Firefox, Real networks, Google, Adobe etc. Of course they reacted and they have created the alliance Real-Networks-Mozilla-Google to cross-promote their products, packaging the new Firefox updates embedded with Google bar and real player.

Vista won’t support OpenGL graphics standard (just as emulation with their Direct3D standard). Apple, Dell and Google joined the Khronos Group that has been working to bring OpenGL graphics to the mobile space. This is anyway a strange move of Google, since their Google-earth product recommends the Direct3D graphics mode, I think because Windows somehow makes OpenGL not to work properly. They are trying to avoid that Microsoft imposes the Direct3D as a standard. As more standards Microsoft owns, the more power it has.

Integration between MSN and Yahoo instant messaging, this was really a non expected move, since months ago Yahoo refused a partnership proposal to Microsoft in sharing the search engine power, and its CEO stated that there were no intentions of a partnership with Microsoft at all. The relations didn’t appear to be good, and that’s maybe why Google haven’t made a response, in the other hand, the messaging is not the Google’s hard brick. It seems to be a response to AOL instant messaging integration with AIM and ICQ.

There is an intense battle of the Microsoft-vs.-world type. As an advertising-based business model, I think that Google has a much cleverer approach, Microsoft advertising is annoying, people is tired of banners and Microsoft puts them all around, instead, Google’s advertisements are interesting, helpful, context based and subtle. In the other hand, unfortunately in this battle, Google has acquired some of the bad manners of its main competitor in terms of monopoly.

It seems that in the technology industry, monopolies will occur indefinitely, Google, Yahoo, Microsoft, a new one… who knows, users just want to deal with one, and just time will say which, – hasta la VISTA!

In one of the papers published here “Strategy Models for the Mobile Industry with the Rise of Wireless VoIP” we talked about the high potentials that skype could have in a mid-long term. One of them was radio sindication, which is basically the re-selling of radio to users using the cost benefits of the P2P network.

Ok, I have to confess that they are always one step ahead. The Skype creators: Niklas Zennström and Janus Friis after making the world-wide successful Kazaa and Skype, got into “The venice project”. This project is being developed basically to create a cousin of SKY and DirectTV (Now 1 company under the SKY name) but this time deilvering TV content through the internet (obviously using a P2P network, as they are now used to).

Sources tell that:
“Zennstrom and Friis have assembled teams of top software developers in about a half-dozen cities around the world, including New York, London, and Venice.”

And that there are also working on negotiations with the most important TV networks to establish this time agreements of television content broadcasting. This time, they have learned the lesson, after all the sues and legal problems they had with Kazaa because of the ilegal sharing of copyrighted material.

Skype, as always, is not really a first mover, but it really knows how to mess everything around and get a massive audience in a very short time. The real innovator in this broadcasting matters is www.youtube.com that has gained a really big audience but has an advertising-based business model (as they claim in their website) different from the premium-service model of skype. Recently, the “I-can-do-all” Google lauched a similar (if not equal) initiative http://video.google.com that is also advertising based.

In just a matter of few months, we’ll see who will own this “new” internet-tv business, and also which other players will join the match. I’m just waiting the moment, when I can see my favorite Colombian-tv-shows from wherever I am, arrives. I know it would take a while, but I have big hopes!

Everybody knows that revolutionary transitions of every-day-use technologies never take place, not only because you can’t make a whole people mass to change the way of thinking, but also because technology evolves in a step-by-step way. So, to complement my past post, today I’ll approach a way how the cell-phone network could migrate in a pace transition, to VoWiFi/VoWiMAX.

This transition has a name and it’s FMC (Fixed-mobile convergence). Today, i got to read about a start-up, www.divitas.com, that has an offer of this type:

“DiVitas makes enterprise-relevant communications networks transparently available to users through a single wireless handset and Fixed -Mobile Convergence (FMC) functionality that includes multi-network roaming, seamless handoff, and secure remote access.”

They are not the only ones innovating in these matters, British Telecom with the “Bluephone project” introduced this approach and so are doing most of the Telecoms, that as a response to the decaying long-distance revenues entered into the cell phone business. Now they are trying to make their network Wireless/Fixed to appear as one.

So… you pay high cell-phone tariffs, but as soon as you reach a WiFi hotspot, your handheld device switches to fixed network and charges you fixed-phone tariffs. The high work here is the approach of the handoff, how can you still continue your conversation even if you changed to a totally different network. In fact, this issue has been resolved but partially, because if it’s true that the handoff is done, there are still a lot of handoff-blocking (Calls lost because of the change), actually lots of research centers are working in order to solve this issue.

The first step has been done, now the trend is that WiFi network coverage increase and progresively you’ll start to use more the WiFi network than the Cell-phone one.

Wait a minute… so where would be the VoIP actual players in this scenario?? As soon as the UMTS internet connection decrease in price, the handhelds would be connecting to – just to say a name – Skype, this way making transparent to the user the fact that they are connected to the internet through UMTS, WiFi or WiMAX, always seeing the same service. Cool huh?

You should know now that I’m really a fan of Skype, since I write all my posts about it. I was really thinking about changing the argument, but it seems that nowadays it’s the only company that really surprise me and push me to write about. You should also know that eventhough I’m a fan, I’m very critic and objective when I write about it. So… here I go:

Today I saw in the Skype blog, the lauch of 4 pure WiFi Skype-Phones:
* Belkin WiFi Phone for Skype (F1PP000GN-SK);
* Edge-Core WiFi Phone for Skype (WM4201);
* NETGEAR WiFi Phone for Skype (SPH101); and,
* SMC WiFi Phone for Skype (WSKP100).
The innovator here was NETGEAR who lauched first the product, but its problem is the price (around US$220). Anyway, the fact that other 3 companies (and more coming) launch also their products is a clear sign that the market trend is toward Skype-Free telephony.

If you add this to the Skype-Zones that is a service that allows you to connect to over 18.000 WiFi hotspots around the world just by paying US$7.95 a month – so you can access in airports, coffe shops, malls, hotels etc. Or to a service like FON that if you share your WiFi router you can have free access to all the WiFi routers of the members of this “club” (and there are around 80.000). Why would you use your cell phone if you can use an Skype-WiFi-Phone for much less??

Ok, it’s true that the coverage of these WiFi networks – even if they are expanding – would not beat the reliability that cell phone networks have. But with the rise of WiMAX – which coverage is in the range of Km – a whole city could be covered reliably.

The problem with the WiFi hotspot approach is that when you change from one hotspot to another you would loose your call, so you have to talk in one place. This however is being solved by different research centers, and is treated in the latest version of WiMAX (802.16e). So everything is pointing to whole-city wireless internet access (In Colombia there are already 2 cities: Bucaramanga and Cali full WiMAX covered and more going), WiMAX-Skype phones, good bye cell phones!

I knew it wouldn’t take long until Skype responded to jajah, it’s amazing the speed as they are evolving and this couldn’t be possible if they wouldn’t have made public their API (To let other companies create/sell products based on the Skype application). They don’t even have to make one line of code, all is done by the aggregates of their “ecosystem”.

Webmessenger announced today the launch of their new product “WebMessenger Mobile”. It has the approach that I mentioned in my last post, as they offer:
“The service provides real-time presence detection of colleagues, friends and family on the users’ mobile devices, enabling them to send and receive chat messages, make phone calls to other Skype contacts, receive calls through their own Skype accounts, and connect up to four participants simultaneously for on-the-go conference calling.” (taken from www.geekzone.co.nz “WebMessenger Launches WebMessenger Mobile for Skype”).

The thing that was not very coherent in jajah service was: If the whole communication is done without any software, why do you actually have to use the computer and an Internet connection? I thought about the possibility of sending an SMS to start the calls; well, WebMessenger mobile has somehow this approach with the use of a mobile device such as: RIM BlackBerry, Palm handhelds, Windows Mobile Pocket PC and J2ME Java phones installing a little piece of software that starts the calls within the Skype-out service in a very jajah-like fashion.

Now, again the problem that I see with this approach is the reach. Not a lot of people have this kind of devices, it should be very interesting that a call could be pushed just with a simple GSM phone. I’m pretty sure that Skype & Co are working in this direction, but somehow the extreme similarity with calling-cards would involve legal issues with these companies.

I hope to see more work of Skype in these matters and discuss them here.

Following up my last post, yesterday I tried a VoIP service that definitely beats the other services around. You just write your number, the number you want to talk to and voila! your telephone rings and after you answer you get connected to the number you wanted to talk to. Even the name is nice www.jajah.com they give you a 5min test to surprise you and depending on the country you are, you can have free calls!

After using it to call my loved country Colombia and enjoying the good quality from my personal cell phone I started to think about their business model and how they actually manage to make money. Compared to the skype out service it has the double of costs since it actually has to make 2 phone calls and it doesn’t make use of a P2P network to distribute the infrastructure (servers) but anyway they give better prices (some cents left).

Obviously the free demo that they offer will figure in their income statement as marketing expenses, they are paying to gain a huge userbase. For now, this service is definitely better as simplicity and costs, but in the long run (let’s say 1 or 2 years) when a good percentage of the 200 Million skypers start to have skype embedded in their mobile devices… nothing beats free! on the other hand the status , Instant Messaging, videoconference and all the features that skype has as an independent software piece would not be possible to offer in this new approach.

I’m really convinced that nowadays the price of the calls are not a desicion maker when the time to choose your VoIP provider arrives, one or 2 cents more doesn’t beat the comfort and additional services that are offered. So, the technology and the people are not yet using mobile devices with Skype on them to call free, then the jajah approach is very clever as a transition but sooner or later they’ll have to switch to a skype-like service to actually make money. We’ll see…

Hey people this is my first post, welcome and thanks for passing by.

I’m one of the most convinced persons that Skype is in the future going to rule most of the calls made in the world. It has about 100M users and recently has made free every call to the US. It has created partnerships with the biggest hardware producers and managed to get embedded in new mobile devices. If the WiFi or WiMAX (or whichever wireless technology gets to be the standard) get a good city coverage… mobile phones as GSM, UMTS etc.. will be gone forever, and a new era of cheap communication will start.

But not everything is a bed of roses for skype, it has turn on bright red lights in all the VoIP players and they are starting to react:

>>Net2phone has sued it for patent violation
>>Lots of players have lauched cheaper and look like services, within the most relevant – Russian Tel-me which user base is growing fast and promise more flexibility
>>Mr. Microsoft has launched its MSN Live in association with verizon to provide calls to land lines and videoconference. Now the largest instant messaging network in the world with almost three times the number of users of Skype offers all in one.

Eventhough Skype business model and P2P platform permits the lowest possible costs, it has to manage very carefully its “enemies” not to be kicked out of the way.

Skype’s reactions should be watched carefully, I’ll try to trace them and discuss them here.