Has Skype Scored a Bullseye in Enterprise Market?

| About: Cisco Systems, (CSCO)

By Chris Marsh

In August after only nine months since it was purchased from eBay (NASDAQ:EBAY) by a group of investors Skype filed for an IPO. A closer look at the filing shows new revenue streams are the goal and the enterprise market a key target:

We believe the business communications market represents a large opportunity for Skype. Approximately 37% of over 40,000 of our connected users surveyed in the first quarter of 2010 told us that they use our product platform occasionally or often for business-related purposes. We believe there is a significant opportunity to better serve the communications needs of the small and medium enterprise segment, as well as larger enterprise customers, by focusing on user needs in this market and developing additional products specifically tailored to business users.

This was followed by a flurry of related announcements including Skype Connect – integration of Skype with SIP-enabled PBX to enable outbound deskphone and inbound Skype calls, a non-exclusive Strategic Alliance with Avaya to jointly develop Business Communications and Collaboration Solutions, and a Channel Partner Program to train a network of VARs and SIs to sell Skype solutions into businesses.

In an interesting conversation with David Gurlé the General Manager and VP of Skype’s Business Unit he stated that all of their engineering work is focused on capitalising on the ubiquitous connectivity that IP brings. With this in mind these developments reflect a series of shrewd moves to accelerate the interconnectedness of PBX networks with its services to allow "access by any customer in any geography on any device."

So with ubiquity in its sights what are some of the implications for the enterprise market?

  • Through "concerted efforts to GTM with the ‘Skype To Go’ product for enterprises" Skype will be addressing a key concern of medium and large enterprises around incurring expensive roaming charges. With all main OS platforms covered this could be very appealing to enterprises trying to cope with a heterogeneous consumerized device environment.
  • By partnering with OEMs like Avaya Skype have a hugely significant GTM channel that could proliferate use cases for the embeddedness of Skype’s services in businesses and their integration with a huge number of connected PBX devices. With more and more employees working outside their company’s PBX and interacting with partners, suppliers and other companies on other platforms and using other systems Skype and its ecosystem partners are well placed to drive adoption of Unified Communications.
  • With many customers also likely to be very keen to leverage Skype’s sizeable consumer footprint, this could drive UC from intra- to inter-company and increasingly to customer use cases for UC. With Gurlé stating that they are "clearly looking at a number of other enterprise partners who have relevance to Skype’s interconnected infrastructure" the potential is only limited by the degree to which Skype can grow the partner ecosystem. With Tony Bates Skype’s new CEO coming from Cisco’s (NASDAQ:CSCO) business divisions the intent seems very clear.
  • The Channel Partner program should enable it to expand its footprint across small, medium and large businesses to those wanting to supplement existing communications systems or adopt new collaborative solutions.

And How About Verticals?

  • As an example a number of financial institutions and call centres in the US and elsewhere have apparently shown interest including financial institutions exploring how to use video and click and call to connect with expat customers, private banking customers connecting with their financial advisors, and institutions using Skype services as a means to market and upsell products amongst their existing customer base.
  • In addition interest from the hospitality industry was also mentioned with hotels for example looking into enabling Skype in hotel rooms.

Ok, so smooth sailing for Skype? Well there are the not so small matters of Cisco here, and how well the IPO goes, but this blog is much too long already so these topics will have to wait…

Disclosure: No positions