How a Legend Was Born and Died: Skype's Twenty-Year History
Many science fiction writers of the 19th and 20th centuries predicted the appearance of a device that would allow us not only to hear the person we are talking to, but also to see them. Today, this has become a reality: we can call a person via the Internet anywhere in the world and see their face on the screen, even if they are thousands of kilometers away.
Today we will tell you about a program that, although it did not revolutionize online communication, gave a powerful impetus to its development. This is the story of a small startup that attracted its first million users in a few months and eventually grew to 400 million. For the third decade, everyone knows about this program, and it still exists, albeit in a modified form. How did this pioneer of online communication appear and what future awaits it?
What was there before Skype?
The idea of video calls began to excite minds already at the end of the 19th century, when the first telephone was invented. It was no longer enough for people to simply hear the other person, they wanted to see them. This is evidenced by numerous patents and experiments conducted shortly after the telephone appeared.
However, the technology and especially stable cameras were not enough to realize this idea. The breakthrough did not come until the 20s of the next century. In April 1927, the telecommunications giant Bell Labs presented the first functioning television complex, which transmitted the image of Secretary of Commerce Hoover over a distance of more than 300 km from Boston to New York. True, the connection was one-way: viewers in New York saw the minister, but he did not see them.
The first two-way video communication appeared in 1931, when Bell Labs demonstrated video call between their two offices. It was the first time the two people saw each other, but the Great Depression slowed the development of these technologies.
It wasn't until 1959 that Bell Labs showed prototype of a two-way video communication system that could only transmit one frame every two seconds, but it provided a clear image. The project was called Picturephone Mod I by AT&T. The name reflected the essence of the device – “a phone with a picture.” Ten years later, the company demonstrated an improved version Picturephonecapable of broadcasting 30 frames per second and designed for office video communications.
In 1991, students from the Faculty of Computer Science at the University of Cambridge invented the first webcam to deliver grayscale images at one frame per second.
With the advent of the 2000s, the era of smartphones began. In addition to the already conventional cameras, front cameras were added, specially designed for video communication. The first pioneer was the Kyocera Visual Phone VP-200, released in Japan in 1999.
Video communication technologies gradually penetrated into various spheres of life. In 2001 a significant incident occurred: The world's first surgery using video communication. A team of doctors from New York successfully performed surgery on a patient who was in France. This was made possible by the development of telemedicine and the improvement of video communication.
Thus, video communication technologies continued to develop, opening up new opportunities for various industries. The era of video communication was coming, and a functional tool was needed, the time of which was inevitably approaching.
How a revolutionary online communication service was born
In 2000, the Swedish company Tele2 decided to create an entertainment portal Everyday in the shortest possible time. The project was led by Niklas Zennström and Janus Friis.
However, something went wrong, and the marketing director of Tele2's Estonian office suggested bringing in Estonian programmers. A daily newspaper published an advert looking for specialists. Among those who responded were classmates Jaan Tallinn, Ahti Heinle and Priit Kasesalu. At the time, they were so desperate for money that they learned a new programming language, PHP, in a few days and completed test task faster than expected.
They got the job and the project was launched, but the Everyday portal failed and failed. After that, Zennström and Friis left Tele2 and started developing new business ideas. This is how Kazaa was born – a file sharing program that allows you to transfer files directly from one computer to another, bypassing an intermediate server. The program was created by Jaan Tallinn at home, and it quickly became one of the most downloaded on the InternetHowever, the project soon faced accusations of promoting piracy, which led to legal problems.
While the lawyers were busy with Kazaa, the team began looking for other uses for P2P technology. In 2002, active work on a new project began, and in the spring of 2003, an early version of the program was given to a small group of people for testing. Initially, the project was not very popular due to technical flaws, such as occasional loss of sound. However, testers quickly realized that they were getting the opportunity to communicate with interlocutors in another part of the world for free, and changed their minds.
The project was named Skype, although it was originally planned to be called Skyper, but the domain name Skyper.com was taken, and it was necessary change name. Despite its potential, Skype did not generate income due to free distribution, lack of advertising and interested investors. The team found itself in a difficult situation and was forced to suspend development. However, it was at this point that the first investor appeared – American millionaire William Draper, who saw the potential in P2P technology and decided to invest in the project.
The first millions invested in Skype paid off a thousandfold. The program was launched in August 2003 and in just a few months scored a million users, which marked the beginning of its rapid growth and popularity. Soon investors, including famous millionaires, began to actively invest capital in the development of the project, seeing great potential in it.
Skype used several technologies, including VoIP (Voice over IP) and P2P (peer-to-peer) protocols. One of Skype's key features was its use of P2P architecture, which ensured equality for all network participants. Unlike traditional centralized systems, each Skype user could act as both a client and a server, which increased the security of data transfer and reduced the likelihood of attacks on the central node.
Despite this, Skype applied closed protocols and forced encryption, which caused discontent among computer security experts. The reasons were as follows:
Closed protocols: Skype's protocols were closed, making security audits difficult. Experts prefer open standards that can be independently tested for vulnerabilities.
Privacy issues: Questions about how Skype processes and stores user data, especially after its acquisition by Microsoft, have raised additional privacy concerns.
However, it was the convenience and ease of use that attracted a wide audience to the program, making Skype the leader among similar programs on the market.
How Skype Conquered Millions of Users
The very first version of Skype supported 10 languages and had a simple and clear interface. The installation and registration procedures were simpler than those of competitors, and the sound quality was comparable to that of a regular telephone connection. Since its inception, Skype has been continuously evolving, adding more and more features to each new version.
From the very beginning, Skype was distributed free of charge. The developers did not strive for immediate profit, but believed in the potential of their product. The ability to communicate via video link without special equipment and for free interested many people, who continued to use the program in the following years.
The ease of use made it easy for even those who did not have deep knowledge of IT to master Skype. Families, friends, lovers, and elderly people received a new opportunity to communicate freely at any time, at any distance from each other. Now, thanks to video communication, there was no longer a need for mandatory trips for meetings – it was enough to press a button and see a person on the screen. This, of course, did not eliminate the need for personal meetings, but it provided a convenient alternative.
Useful Skype features:
Calls to landlines, which is useful for people without mobile service or internet access. While Skype's core features, such as video calls and messaging, were free, calls to landlines and mobile phones were offered for a fee. However, Skype's rates were competitive, making it a popular choice for international calls.
The program is supported on different platforms – Windows, macOS, Linux, iOS, Android, which allows it to be used on various devices.
Video conferencing, call recording, screen sharing, and file sharing are all features that made Skype popular with both personal and business users long before Zoom came along.
The program also supports communication in 33 languages, making it accessible to people all over the world.
However, in recent years, attitudes towards Skype have become more controversial. Many users have noted a decline in the quality of the service, which is reflected in the program’s ratings and the decline in the number of downloads. The previously successful and popular program has begun to lose ground to new competitors such as Zoom and Microsoft Teams. In the next section, we will take a closer look at the reasons for these changes.
The Microsoft Era
For tech giant Microsoft, buying Skype for 8.5 billion dollars in 2011, the most expensive deal to date. The company hoped that the investment would soon pay off, planning to integrate Skype into Windows and other products.
Skype was used as the main service for messaging and video calls. Facebook (banned in Russia) introduced video chat, allowing several users to communicate simultaneously, and Skype for Business opened up the possibility of video conferencing. The program was integrated into new products such as Windows 8.1, the Xbox One console, and the Outlook package.
The original P2P architecture, which worked well on computers, was less effective on smartphones, leading to problems with connection quality and service stability on mobile devices. In 2013, Microsoft made a decision move to cloud servers to improve scalability and stability of the service, especially on mobile platforms. The move to cloud servers allowed better control over the connection and quality of service, but this process dragged on for years and was accompanied by many technical problems.
The troubles began when Microsoft began rolling out updates that complicated the program's interface and reduced its functionality. For example, setting up group conferences became more difficult, and frequent automatic updates irritated users. In addition, many users began to experience connection quality issues. These issues could be related not only to the program itself, but also to the transition to a cloud architecture, which required time to adapt and debug new servers. In addition, registration in the application, previously known for its simplicity, became more difficult and required additional steps. All this together caused negative reviews and a decline in trust in Skype.
Meanwhile, competitors like WhatsApp and Zoom have been actively developing their services, focusing on convenience and reliability. In 2016, Microsoft launched a new platform for communication and work — Teamswhich took many of Skype's features and provided a more comprehensive business solution, including video calling, calendaring, and virtual meetings. This further weakened Skype's position as many users and businesses switched to Teams.
As a result, the simplicity, functionality and quality of Skype that attracted millions of users in the early 2000s began to fade under the onslaught of constant changes and updates, which led to widespread user dissatisfaction and a drop in the program's ratings.
One unhappy customer wrote: “I feel like with all these updates, Skype is taking up valuable space that they could instead use to improve the experience. Lots of new features, icons, lists, and tooltips that no one is going to use.”
The Real Skype and Why the Legend Is Leaving
Of course, Skype noticed the storm of indignation, but for some reason, no radical changes were made. And to fix the situation, time was needed, which was precisely what they did not have. The outbreak of COVID-19 sent office workers home, and a reliable application for remote work was immediately needed. Overloaded with unnecessary features, slow and unreliable Skype turned out to be uncompetitive. Eyes turned to the simple and effective Zoom, which users compared to “almost like the old Skype.”
Zoom's market share increased by 22.3% between 2020 and 2021, while Skype's decreased by 25.8%. According to Microsoft, Skype had about 40 million active users in 2020, down significantly from its heyday when the program had hundreds millions of fans.
Zoom wasn’t the only competitor, however. Microsoft Teams, offering a more comprehensive solution for video conferencing and collaboration, gradually took the lead, pushing Skype aside. Despite this, Microsoft continued to support Skype, but its efforts were focused on developing Teams.
In 2023, Microsoft CEO Yusuf Mehdi announced the introduction of AI chatbots into Skype, allowing users to receive assistance while they are talking. The Skype team also modernized video calls, improving the program's performance on various platforms. For example, performance on Android has increased by more than 2000% in some aspects, and on desktop computers by 30%.
These improvements, according to the Skype team, should open a new chapter in the history of the program, which has been around for almost two decades. The only question is whether these changes will be able to return Skype to its former popularity in its third decade of existence.
Do you think there is still a chance for the “best file sharing service” or will it smoothly and quietly pass into the next world, as ICQ has already done?
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