Skype Positions Itself as 'Enhancement' VoIP, Not Responsible For 911 Service

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May 24, 2005 (3:33 PM EDT)

Skype Positions Itself as 'Enhancement' VoIP, Not Responsible For 911 Service

By W. David Gardner , TechWeb Technology News

With three million users in the U.S. and a rapidly-growing group of partners in its new affiliates program, Skype Technologies is facing a unique challenge presented by the FCC's order that VoIP providers must provide access to emergency 911 numbers.

The Europe-based firm is positioning itself as an "enhancement" service to existing telephone service and not as a "replacement" service. "We're an enhancement like fax," said Kelly Larabee, a Skype spokeswoman in the U.S. "You should know that Skype is not an emergency service."

Skype officials have met with the FCC to explain its position and the VoIP company has lauded the FCC order. In a statement, Skype said: "Skype commends the FCC for moving quickly to ensure that users of VoIP who expect 911 service get 911 service. Skype also applauds the FCC's effort to make sure that the 911 service will work by recognizing that many parties, not just VoIP providers, play a role in opening the existing 911 system to new technologies."

Larabee said Skype realizes it will be subject to FCC provisions and favors solutions that will be wider and also cover the growing firm's worldwide audience of nearly 40 million. She noted that Skype's service " as well as the service of other Internet telephone firms " would fail if and when the underlying broadband connections fail or lose power.

Larabee added that there are ways Skype could enhance emergency services. For instance, text messages or e-mails could help persons in distress to communicate in some situations.

Earlier this month, the FCC served notice on VoIP providers that they wouldn't be permitted to operate unless they have a functioning emergency calling service. The issue has been a priority of new FCC chairman Kevin Martin, who assumed the chairmanship in March. While the FCC order isn't likely to apply directly to peer-to-peer providers like Skype, it clearly will affect other VoIP providers like Vonage and AT&T, whose services are marketed as replacement services.

Vonage, the largest U.S.-based VoIP firm, has forged agreements with landline telephony operators like Verizon Communications and SBC Communications to insure that 911 emergency service is provided. With some 650,000 subscribers Vonage's service is primarily aimed at replacing traditional domestic service in the U.S. On the other hand, Skype, which claims three million U.S. users, presents its service " free to other Skype users " as an enhancement. Its U.S. business model has Skype callers typically using the service for international calls.

In an announcement Tuesday, Skype's CEO and co-founder Niklas Zennstrom said the firm's affiliate program has attracted more than 1800 partners. Various Skype users ranging from online communities and publishers to bloggers and enthusiasts have signed up for the Skype program that rewards them with commissions up to 10 percent for promoting Skype on their websites. The program is managed by Commission Junction, which provides Internet affiliate marketing programs.