How Skype and Kazaa changed the net

Read an interesting interview with Niklas Zennström, the man behind Kazaa and Skype by the BBC Click Online in which he states that

Ultimately [Kazaa …] are great things

and compares the problems faced by the new medium to similar issues of the past:

“When radio stations started playing music the record companies started suing radio stations. They thought now that people could listen to music for free, who would want to buy a record in a record shop? But I think we all agree that radio stations are good stuff.

“And the VCR did the same thing: the movie industry thought nobody would ever watch movies any more.

“But that technology enabled the movie industry to make much more revenue. The single largest revenue source for the movie industry is videos.”

More is found on Skype, that

undercuts a lot of revenues of the big phone companies, who have been using outdated technology.

and relies on an interesting pricing model:

Skype makes money because a small fraction of users is buying additional services, such as the capability to call from Skype to the telephone network or vice versa.

Not having to make money from every user is not a new idea, Zennström emphasises.

“It is very similar to companies like Google and other internet companies. When you go and search on Google you don’t pay for that. But sometimes you click on an advert and Google makes money on that.

“It’s the same thing with Skype. Some users are paying for services, but not everyone.”

Notice that

Zennström believes the losers out of this new structure will be the telcos who do not understand that there is a change going on.
“This is a disruptive technology that shifts the industry”, he says. […] Skype, just like Kazaa and other software, are encouraging people to buy broadband connections.

read more at the BBC

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