Skype to Charge $30/Year for SkypeOut Online VoIP Service

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Skype to Charge $30/Year for SkypeOut Online VoIP Service

9:15 am on December 15, 2006 | Category: VoIP, Web Services, Telephone, Software

Online VoIP giant, Skype, revealed earlier this week that it will soon begin charging for SkypeOut telephone service within North America, which has been available for free since May.

Beginning on January 1, unlimited web-based phone calls to landlines in the U.S. and Canada will be priced at a flat rate of $30 per year, ending a much-loved eight-month promotional offer. Calls from one computer to another will remain free as always.

“We see a willingness by consumers to make SkypeOut calls that are well priced,” explained Skype’s general manager for North America, Don Albert, noting that the cost was still negligible compared to the $25/month charged by many VoIP providers.

Most industry analysts believe that this is an irrelevant comparison, however, due to the fact that Skype is a purely internet-based service, and can’t be used in conjunction with a regular telephone. Unlike the broadband phone services offered by Vonage and many North American cable providers, Skype generally requires users to download a special software client and make calls from the same device on which it is installed.

“Skype requires a behavioral change. Consumers have grown quite comfortable using their telephones,” commented telecommunications analyst, Jeffrey Halpern, of Sanford C. Bernstein & Company. “I don’t view Skype as a real threat to the telephone companies, or even Vonage or the cable companies.”

Whether Skype’s $30/year VoIP service can inspire mainstream adoption remains to be seen, but the company needs to recognize the fact that they’re competing in a completely different market than other digital telephony carriers.