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Kazaa founders tout P2P VoIP

Ben Charny CNET News.com

Published: 12 Sep 2003 10:30 BST

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Do you think VoIP will ever become a primary phone service? Many don't think so, because when the power goes out, so do VoIP phones. And you can't dial 911.
Eventually, someone will pull the plug on the traditional circuit-switched telephony network, but this may take some time. Why should the P2P generation (teenagers growing up with Kazaa, Skype and others), get a normal phone line when they move out? They'll just get broadband and Skype. Issues like 911 and power cuts are fairly trivial, and are mainly being used as an argument against VoIP from the entrenched players.

It looks like US states are going to regulate VoIP providers. What's the situation in other countries?
Skype provides a piece of software that connects users directly and is not subject to regulation in the European Union. We've obviously checked this with our lawyers. When Skype or one of our partners rolls out additional services such as the ability to call normal phones, these features may fall under the regulatory framework, and Skype will comply with applicable laws and regulations.

Does that mean that Europe will be a breeding ground for VoIP -- more so than the United States?
The telecommunications environment in the European Union is highly deregulated. It's designed to encourage competition and new technologies, and typically, it's fairly nonbureaucratic. For example, all you have to do in Sweden to get your own telephone numbers to dispense is to send a letter to the regulatory authorities and pay a fee of 1,000 Swedish krona (about £ 77.) When you have done this, the established telecoms are required to provide you with interconnect agreements on market terms.

You seemed to suffer from a very good problem: In your first few hours of operation, there were too many downloads. What happened?
Skype went from almost zero to 60,000 downloads in just one week. It took more than three months for Kazaa and Free World Dialup to reach those totals. This created a very high load on our download and registration servers. At the same time, we suffered from some outages at our hosting provider. Everything is running smoothly now, although we do expect occasional hiccups during the beta period.

One thing most people say about Skype is the tremendous following it's likely to have, given its pedigree and the 250 million downloads of Kazaa. Will Skype leverage Kazaa's popularity? If so, how do you do that?
The growth since we launched has been purely viral. There's been a lot of media coverage, but this does not seem to have much impact. Before we launched, we thought that Skype would be even more viral than Kazaa. When you've got it, you want your friends to get it as well, so you can talk for free. With Kazaa, you don't really need your friends on it, but people think its cool and recommend it to their friends.

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