Skype: The cell phone replacement? By Steven Schneidman Wednesday, October 18, 2006

It used to be every generation or two that a great idea would come that would change every body's lives. Today we seem to be getting one or two every year. Why is this so? Due to globalization, decreasing margins in every business and a rush to be the most efficient, entrepreneurs are inventing new products that can effect every one's lives.

Technology changes whole industries. The fax machine had a great impact on the mail industry. A few years later email had a greater impact on both the fax industry and the mail industry. The video rental business cut into the movie theatre business. Beta machines and VCR's then cut into the video industry by people making illegal copies of movies. The DVD industry then cut out the VCR industry and now downloading by the internet is cutting into the DVD market.

Globalization has changed the way we do business forever. Every market is very competitive. We find the best global place to produce the product, we find the best global place to service the product and we find the best place globally to have our customer service people. You buy your Dell computer from the internet (replacing a local store), they produce the product in China(replacing a local manufacturing plant) and when you call about a problem on an 800 number, someone in India answers your question (replacing a local customer service person). The reason we do all of this is that everyone looks for a better price. This is evidenced by us shopping at stores like Walmart and Costco, whose raison d'etre is low pricing.

The last bastien for high margins has been the telephone industry. First they had monopolies over local phone rates. When this was cut they maintained their cash cows in long distance pricing. Ever wonder why pricing was so high. The long distance lines have been there for tens of years. Capital costs are minimal today to maintain these lines. This is where Skype comes in. Through a VOIP internet connection you can make free long distance calls. All you need to do is download a free program together with your friends, families and business associates and your calls are free. You can also call land line numbers at less than 2 cents a minute. The next revolution is on.

Who are good candidates for Skype? Firstly, students are usually the first adapters to any new technology. Just like they are MSNing their friends right now, a lot of them are switching over to skype to have a more personal call or to call friends outside their local calling areas. The second group are college kids. These kids are generally budget conscious and far away from where they grew up. Family and friend connections are very important and Skype can reduce their expensive College expenditures. Thirdly, businesses can use Skype to call branch offices at no charge or use Skype to dial out to customers across the country or world at a fraction of their current long distance rates. Lastly, when was the last time you used your cell phone and got charged their roaming and long distance charges. With new Wi-Fi sites popping up every day and peoples use of lap tops skyrocketing, you simply plug your Skype phone by your USB and start talking free. Imagine being in an airport or restaurant, you pull out your mobile Skype phone and start talking for free. The phones today are as clear as regular phones and offer many of the same features.

With people and businesses budgets being squeezed it's a natural that Skype with over a billion downloads will continue to grow. To learn more about Skype you can google it or check out www.solutionsink4u.com. If you have any questions you may email me at steve@solutionsink4u.com, to learn how to save money on all your communication needs. You should never have to wait to call someone again.

Steven Schneidman Solutions Ink