A Look at Skype Connect

28 Nov 2010

Skype is not your typical carrier, in fact, it isn't even a carrier. But if it were considered a carrier, it would be the world's largest. Skype falls into a strange space between application, service provider, and carrier. Skype has over 124 Million average monthly connected users (for the first three months ended June 30, 2010), and boasts over 20 million users actively connected at a given time (Skype recently crossed the 25 million simultaneous user threshold).

Skype is mostly known for its rich client which, by many definitions, is the model of unified communications (a bit weak on APIs though). The client offers presence and IM through its contact list (buddy list) capabilities, voice and video calling, collaboration capabilities such as desktop sharing, conferencing services that includes up to 25 voice users or 10 video users. A conversation can move from text to voice to video and back. A history capability shows logs of all types of conversations. Users can share their desktop screens and create ad-hoc conferences - all for free in the case of Skype-to-Skype communications.

How does a free service make money? That's the big question and it's on top of a lot of minds lately as Skype is planning its IPO with a target valuation of $1 Billion (as reported by TechCrunch). Skype is developing numerous revenue streams largely associated with Skype-to-PSTN services. Skype is also expanding its footprint with new programs aimed at building users and usage through mobile, consumer, and enterprise programs.

I thought I would take a look at Skype Connect - this service essentially provides SIP trunks, but with a Skype twist. The service is designed to connect an on-premise voice solution to Skype via SIP. Because the interface is SIP, it's just a voice service. Most phone systems can't support richer features such as presence to an external SIP carrier. Though that will purportedly change in the next year or so. Avaya and Skype announced a partnership which intends to do just that and many more of the communication features found in the Skype client from the phone system to Skype via Skype Connect (at least for now, Skype and Avaya share majority ownership control by Silver Lake Partners). .

Skype Connect has two key attractions; free inbound services from Skype users, and inexpensive PSTN services - both with a global perspective. Skype does not provide network access services; Internet services must be obtained separately. Yes, Internet - Skype does not offer private networking services such as dedicated links or MPLS access. It is important to remember that Skype is not a traditional network; it's a peer-to-peer network that relies on the Internet.

Skype Connect is supported on seven brands of phone systems, they are from: 3CX, Avaya, Cisco, Freetalk, ShoreTel, Siemens, and SipXecs. If you don't have a phone system by one of these, then you will need to consider a gateway solution from AudioCodes, Grandstream, or VoSKY; see Tekvizion Labs for third party testing. Even if you do have a Skype certified vendor, you may want to consider the gateway approach - the Audiocodes gateway includes a session border controller (SBC) for increased security.

Most of Skype's services are geared toward individuals, not companies (though many of those individuals are at the office). As a result, Skype needed to create Skype Manager as a solution for managing multiple accounts and services. That's where Skype Connect starts, create a free Skype Manager account. The next step is to create Skype Profile(s) which are individual Skype accounts that are managed centrally within Skype Manager. It is a good way to control Skype accounts that the business wants to own to mitigate the impacts of employee turnover. Skype profile accounts can be basic SkypeIDs or Skype Connect IDs. SkypeIDs can be set up on computers with the Skype client. The Skype Connect numbers don't have features like voice mail, and instead include SIP credentials.

The next step is to purchase subscription channels for each Skype Connect users. Each subscription channel enables one concurrent call path. Most SIP carriers simply call these trunks, and with Skype they run about $7 a month. Skype services all follow a prepaid model, so in addition to a subscription channel you need some calling credits loaded on the profile. Skype Manager allows credits to be reallocated among different profiles as necessary.

At this point, the phone system can receive Skype calls assuming the trunks were properly provisioned. This is a good place to do some testing. Remember, the phone system has be told how/where to route the calls. Invite friends and family to call for testing, all that's needed is a Skype client to initiate the call - The phone system can now receive calls from over 500 million registered Skype users worldwide; for free! And it gets better.

In Skype Manager, you can purchase phone numbers and assign them to profiles as well. Skype calls these "Online Numbers" and they can be leased for 1, 3, or 12 month terms and run about $30/mo each. The "local" phone numbers can be purchased in any of the following markets: Australia, Chile, Denmark, Estonia, Finland, Hong Kong S.A.R., China, Hungary, Malta, Mexico, Romania, Sweden, United Kingdom, United States. This means customers (and employees) can now call you "locally" in any of these markets. They can call from Skype with a SkypeName (free) or from any phone with a purchased online number. Once the call is received on the PBX it becomes subject of phone system programming; as an example, calls could be routed directly to a customer service ACD queue.

Calling out is not as simple. A PBX can't dial a SkypeName, it has to dial telephone numbers. This is what most people know as Skype Out - using Skype to dial PSTN numbers. The bad news is you can't dial PSTN numbers on Skype for free, the good news is it is probably cheaper than what you are already paying. For US domestic calls, Skype charges about $0.008 a minute. For US to most of Europe it's about $0.02 per minute. Note, this is outbound PSTN dialing - it does not matter if you are calling a Skype (SkypeIn) user or not.

Skype Connect is priced very attractively, but there are risks. First off, there is the nature of prepaid services - they make sense and when you consider how much of your bills subsidize bad debt. But Skype doesn't offer refunds. Prepaid accounts need to be watched. Skype offers a way to automatically reload credits, but that carries some risk too.

Secondly, there is no way to avoid the public Internet. Using the public Internet for voice isn't uncommon, but more and more, companies are insisting on methods that ensure a high quality expereince. I don't know of any methods that can accomplish this with Skype. Skype-to-Skype calls are usually very good quality, but they involve Skype's efficient and wideband SILK Codec. Skype Connect has to use G.711 to ensure compatibility with phone systems. Therefore quality is a bigger concern. Lower quality is fine when you know its an Internet user calling (they will assume the quality issues are on their side), but with real phone numbers it is a different matter.

Many business professionals discount Skype as a not-for-serious-business Internet fringe thing. But Skype's grown up and deserves a new look. Skype offers numerous case studies on businesses that utilize Skype for all (or at least a majority) of their communications. Combined with Skype Manager means accounts, dollars, and features can be centrally managed. Skype does not offer emergency services or analog support (alarms, modems, fax) - but does offer a tremendous amount of capability. In fact, many of the UC enterprise vendors are still working to match the functionality Skype users take for granted.

Dave Michels, principal of Verge1, is a regular contributor to UCStrategies, as well as maintaining his own blog, Pin Drop Soup.


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