In ten years time we may look at Skype in the same way we look at Amazon and Google, as a huge built-to-last company, for these ten reasons:

1. It has revenue, about $500 million in 2008. Ahem, only in the strange world of Web 2.0 is that considered remarkable. I love using Twitter, but without sustainable revenue their future has to be in question.
2. It is profitable. We're talking "high-teen margins," according to eBay's CEO at the Accel Symposium. That does put it in a different league. It means they can survive the harshest of economic climates. If Facebook is having to raise money in these markets their model must be fundamentally flawed, which means their time as an independent company may be limited. To control your own destiny, you need to be profitable.
3. Skype's growth is accelerating in a tough market. Skype is publicly talking about growth rates of 30% to 40%. That's not bad in an economy where flat is the new 30%. Skype has the perfect recession pitch: cut costs now! This shows in its most recent numbers. In the last quarter, Donahoe told us that Skype-to-Skype grew 73% and Skype Out grew 63%.
4. Disruptive technology. Disruptive technology is an over-hyped term, but in this case it really fits. Skype's peer to peer technology enables them to dramatically under-price the competition and still make money. New users don't cost much money - compare that with Facebook and YouTube. Even better, each new user that comes on improves the service for others - the core P2P proposition.
5. Viral marketing. Skype is the perfect viral business. I have lost count of the number of people I have told about Skype, for the simple reason that I want to communicate better/cheaper with them. Many of them are doing the same.
6. Massive market with vulnerable incumbents. $2 trillion is a lot of money. That is the size of the global telecom market. As to vulnerable, how many people feel so loyal to their telephone company that they won't switch to get lower prices? Yes, when Skype dominates the market it won't be worth $2 trillion any more. Even if it is worth 25% of that, say $500 billion, that is OK for the dominant player. Faced with the Skype threat, incumbents have a horrible innovator's dilemma. To really match Skype will destroy their current business even faster.
7. Just wait until it bites into those cell phone bills. Skype on mobile phones - really native Skype you can use for free wherever there is WiFi - has been possible technically for some time. This has been held back by the mobile operator's head lock on the device manufacturers. At some point the dam will break. Consumers pent up anger over nickle and diming cell phone bills will ensure that a real alternative will be welcomed.
8. Skype is totally mainstream. This is not about being hip or early adopter. Just show the video conversation to anybody with loved ones in distant places. You will see the surprise and amazement that makes it seem like magic.
9. It is a sticky service. Google still gets my business because they are better than the alternatives. But switching to an alternative will be totally simple. When somebody suggests using something other than Skype, I resist. I have my contacts in there, know exactly how it works and have integrated some external tools. Skype can continually add new features to make the experience better as our hunger for communication is pretty well limitless.
10. Skype can do an IPO. For anyone younger than 30, we should probably spell that out: Initial Public Offering. We keep being told that the IPO market is moribund because of Sarbanes-Oxley. Baloney! The IPO market is moribund because we have lacked profitable high-growth companies that move into huge markets.

My prediction is that as soon as market conditions improve, eBay will sell Skype through an IPO. Their shareholders will pressure them to do so. There is no synergy logic in being part of eBay. The value of Skype is obscured by the problems in eBay's core business. The Skype IPO can be early in the market recovery, as their story resonates so well in a recession (markets usually recover well before the economy recovers).

Who Else?

Who else can take the title "biggest winner from the Web 2.0 era"?

• Google: not really Web 2.0, though; born in 1999.
• YouTube: still losing money, no clear monetization model, and video-serving costs are substantial. It is hard to imagine YouTube as an independent company
• Facebook: how long can the great hope remain the great hope? At some point, it has to demonstrate a sustainable revenue model and some profit. It still doesn't have a native revenue model that makes sense to both users and advertisers.
• Twitter: see above.
• Salesforce.com: not really Web 2.0 either; born in 1999. More revenue than Skype today, but smaller addressable market.

With Pyjamas, this is now possible.

While it looks like a desktop API, Pyjamas is a stand alone Python to JavaScript compiler, an AJAX framework / library and a comprehensive widget set API.

The advantage of using Pyjamas is that you can write Web applications in Python instead of HTML and JavaScript; rather than trying to fit as much HTML as you can into one page, you can reuse and import classes and modules.

Additionally, the AJAX library deals with the entire browser interoperability issue - you don't need to worry about the browser wars to make your app cross browser compatible for IE6, IE7, Firefox, Safari, Opera etc.

If you're interested in learning more, the Pyjamas site points to a tutorial, an online version of the Pyjamas Book, and other useful links.

In the first of three videos (embedded below), the former vice president and chairman of Current TV discussed among other things: World 2.0, politics, the ongoing fight to save our planet, the importance of democratizing the television media, and the significance of "puppies having a purpose."

Likening Web 2.0 to the evolutionary path of electricity, Mr. Gore pointed out that the newness of a service or product often creates a 'wow' factor that holds up progress until the service is taken for granted. 100 years ago, the early uses of electricity demonstrated the special qualities of the then new conveyer of power; today, it's everywhere, and people pay it little attention. According to Mr. Gore, much the same needs to happen with the Internet; it needs to get to the point of being like "the water that the fish don't know they're swimming in," he said.

How to Democratize the Television Media

Using a story known to most business graduates, the invention of the electric dynamo, Mr. Gore explained change cannot happen until we redesign and "re-architect" the context in which these activities take place - a place he calls World 2.0.

The electric dynamo story goes back to the early days of electricity and the invention of a new electric motor - the dynamo. It was clearly demonstrated that the product was more efficient than the water wheel or steam as a source of energy so many early adopters installed it in their factory and waited. And waited. After several decades the retroactive analysis concluded that the architecture of the factories had been optimized for steam/water wheel power and the potential for the dynamo couldn't be unleashed. Once the factories were replaced with new architecture, there was an incredible explosion of productivity.

Revolutionizing the Public Sphere

Five hundred years ago, explained Mr. Gore, the printing press revolutionized the public sphere. Before that there was a monopoly on information. With illiteracy affecting 99% of the people, information was filtered by the church, the monarchy, all economically, politically and spiritually concentrated; the print press brought radical change.

It empowered individuals to use knowledge as a source of influence and power and a new information ecosystem developed that allowed anyone who could learn to read and write to realize they could have a new sovereign - the rule of reason. According to Mr. Gore, this ability to connect, comprehend and make decisions independently matured into the American constitution.

A Puppy Has to Have a Purpose

After buying a puppy for their young children many years ago, Mr. and Mrs. Gore asked a dog trainer to come in and give them advice. Her first question was "What is the puppy's purpose? Is it going to be a watch dog, is it going to get the newspaper in the morning, is it for the children to play with?"

Much like puppies, according to Mr. Gore, Web 2.0 has to have a purpose. The purpose he urges us to consider is to bring about a higher level of consciousness about our relationship with this planet.

"We have everything we need to save it, and in the process create millions of new jobs, reduce our national security exposure, and solve the climate crisis," he said, but, "just as Barack Obama's election would have been impossible without the new dialogue and new ways of interacting on the Web, the only way this is going to be solved is by addressing the democracy crisis."

Part 1: Al Gore's Speech [16:22]

Part 2: Al Gore talks with Tim O'Reilly and John Battelle [13:16]

Part 3: Q&A with Al Gore [17:39]

Jott moved to a paid model following a successful free beta. I spoke with Jott CEO John Pollard to learn how they did it and how it is working out for them.

Jott still has free service, but it's been put together such that if you are a frequent Jott user, you'll be very tempted to upgrade. The upgrade itself is less than $4 so I suspect many people will go for it. Jott has a variety of plans to choose from including free, basic, pro, pay-as-you-go, etc.

The company based these plans largely on user behavior and lots of data. When they started the company, they knew they would ultimately have a free and paid version, but had to learn the rest along the way. For example, they had to find out if their customers were home makers, road warriors, students, professionals, etc.

Some of the factors they experimented with during the beta program included turnaround times, length of recordings, and features. By collecting data around user behavior and usage, they were able to model scenarios and identify trends. They then used focus groups, the Jott user group, and conjoint analysis (a very cool survey technique requiring users to make trade-offs on product features versus price) to come up with the different packages. They were very confident that some professionals wouldn't want an ad-supported service, and the research confirmed it.

As you can imagine, they overcame significant challenges along the way. While many users understand that Jott has to put food on the table, there were users who were shocked that a company dare ask for money. Personal note: this is both a common and ridiculous sentiment that has grown as more "free" things pelt us, but that is a conversation for another day.

John and company decided to be extremely transparent about the process and spent significant time in their forums, hitting the blogs, and using other marketing mechanisms to tell their story and let users know what was going on. John admitted they could improve on the communication front, but they did a solid job. The communication philosophy was to tell the users what was coming, tell them when it was coming, and explain why - as many times and in as many places as they could.

The company is very pleased with the conversion process so far. They are apparently hitting their goals and on plan. One pleasant surprise according to Jott is the percentage of people selecting annual plans; John said they are getting 10 times the number of annual subscribers that they expected. I'm not surprised as I'm sure a large percentage of Jott users are business customers, and this is the most efficient way to get something expensed; although this is pure speculation on my part.

John has good advice for other companies embarking on this journey. First, talk to your customers as much as possible. Really talk to them and understand the problem you are trying to solve and how they use the product or service. Second, utilize web-based tools like conjoint analysis to gather quantitative information to make decisions. Finally, try to be transparent and don't surprise your customers; they hate that. If you build something that people want and value, you can ask them for money and it is good business.

Browzmi was founded by Travis Parsons in 2006 and is currently being developed by a five person team. Browzmi has not taken any venture funding yet. Registration for Browzmi is open.

Browzmi allows you to surf the web with your friends. The core of Browzmi is made up of its bookmarking and sharing function, as well as the built-in IM. The chat function, as well as the real-time updates on the site, are enabled through an XMPP and Jabber back-end.

It's important to note right away that Browzmi is not a screen sharing application. While you can follow your friends around the web, you are not sharing the exact same experience with them and you don't see their mouse cursors moving around etc. Browzmi instead focuses on real-time sharing and discussion.

This concept, of course, is somewhat similar to that of Me.dium or Yoono. However, the interesting aspect of Browzmi is that it does not rely on extentions at all.

Just Like a 'Real' Browser

The Browzmi interface mimics a regular browser, with a location bar and search form at the top, as well as sidebars on the left and right. Thanks to this, new users should feel right at home when opening up the application. There are also back and forth buttons, as well as a home button that takes you back to the Browzmi 'Everyone' page.

Once you surf to a site, you can comment on a page, bookmark it, and make your opinions about it known by voting up or down on it. You can also 'clip' pictures from a site, making Browzmi a photo sharing application as well. All your actions on the site are saved in a stream that you and your friends can access and which looks somewhat like a stream in Friendfeed.

Sidebars

The sidebar on the left side of the screen ("My Stuff") is mostly reserved for seeing where your friends on Browzmi are right now. Thanks to the "Surf with Friends" feature, you can follow them around the web and chat with them. This sidebar is also where you can access your favorites (which basically function as bookmarks), see your activity stream, and see your friends' online status.

The right sidebar is called "Explore More" and it allows you to see where other users are on the service right now, as well as related content on Flickr, YouTube. Here, you can also see what other users who are not in your network have said about any given site.

Thanks to the XMPP back-end, all of your friends actions are being pushed to you instantaneously .

Privacy

When we first reviewed Me.dium, which offers a number of features similar to Browzmi, we were worried about the privacy implications of the service. Browzmi allows you to make your stream public or private, but any of your online activity through Browzmi does, of course, show on Browzmi and is available for viewing by your friends or (if you don't set the privacy features right) anybody. Given that users are probably quite aware that what they are doing is public - that is, after all, the whole point of the service - we are not too concerned about this, but it is still worth pointing out.

Coming Soon

Browzmi is currently working on adding number of additional features to the site, including allowing users to sign into the site with their AOL, Yahoo, or MSN credentials, which would allow everybody to chat with their IM friends right from Browzmi and also to invite them to surf the web with them. Integration with AOL's IM system will be announced in the next few weeks and the others should follow relatively soon after that.

Browzmi is also planning on allowing its users to comment on specific items on a site. This is something a few other bookmarking services already allow, but without allowing for real-time sharing.

The Browzmi team is also going to release an API in the future, which will allow developers to add widgets and customize the Browzmi experience.

Verdict

We were skeptical of Browzmi at first. Why, after all, would you need a browser within my browser? However, with the IM integration, its various RSS feeds, and straightforward surfing experience, Browzmi is actually a lot of fun to use. If you used it with Fluid or Mozilla's Prism, you could even make it your standard browser interface if you were so inclined. While that is probably not even Browzmi's intention, it does open up some interesting possibilities for the future.

In our tests, Browzmi worked very well and we didn't come across any bugs. For some sites, where Browzmi might be problematic, you can download a Firefox extension, but in our tests, we never needed it.

Browzmi, like most similar services based on social interactions, is going to get more useful as more users start joining and as your list of friends growths. In many ways, it is complementary to other services like Friendfeed, in that it gives you an option for real-time sharing and discussion, while you can also import most of your Browzmi actions to other services through Browzmi's RSS feeds.

Once Browzmi adds more IM services, we think that it can grow quite rapidly and organically, as there will be zero friction for new sign-ups.

JSON stands for JavaScript Object Notation. According to the Wikipedia entry, JSON's simplicity has "resulted in its widespread use, especially as an alternative to XML in Ajax".

I had the pleasure of speaking to Toni recently and I know the Yahoo folks have lots of plans around APIs. As Yahooligan Matt McAlister recently wrote in reference to a Scott Gatz speech: "Kevin Burton asked about public APIs. Scott pointed him to developer.yahoo.net where the current APIs are posted and some community efforts to help facilitate more activity. He said, Yahoo! is still testing some concepts, and the company knows that this is incredibly important. And Scott said we can expect to see a lot more in that area. "

Thomas van der Wal thinks "it may be one of the brightest ideas of 2005" and Jeff Clavier has a good analysis: "This is a positive development for the industry, eventually pushing blogging into richer types of applications - and enabling new types of aggregation."

Structured blogging has been talked about for a wee while now and, as is usual in the RSS world, has had competing ideas and formats to deal with. But this latest development marks a milestone, because there are now Structured Blogging plugins available for the two main 'early adopter' blog platforms - MT and Wordpress. That's what Phil and a whole host of others (named in his post) have been working so hard on to release today.

With any luck, Structured Blogging will quickly gain some momentum due to the plugins - and before you know it will go mainstream. I'm expecting big things from this in 2006.

disclaimer: I do freelance work for BBM, where Marc and Phil work. But even so, Structured Blogging rocks!

Phil Pearson, XML expert Kimbro Staken and Movable Type consultant Chad Everett have been working on a Structured Blogging plugin for Wordpress and MT. This is to enable ordinary folks (like me) to publish "new microcontent types, support microformats and other standards like Media RSS". Phil's looking for feedback, so if you're technically inclined jump over to his blog and add your 2 cents.

Also I found a great resource via the 9rules homepage, an article at Fiftyfoureleven.com about how to use the Yahoo! API. As it states in the intro:

"Looking at Yahoo!s APIs, you can see a little of that "openess" that Yahoo! CEO Terry Semel referred to at 2005's Web 2.0 conference. From images to movies to maps and search, they offer a lot of data through their APIs."

Fiftyfoureleven.com also offers an ongoing API series. Great stuff and I'll be reading this very closely and experimenting when I get some free time (in about a week!). Also check out ProgrammableWeb's How to Make Your Own Web Mashup article. The beauty of mashups is that anyone can play, thanks to great resources like these and the backend work of folks like Phil Pearson.

"Tonight we are launching a full post rss reader in the new Yahoo Mail beta. If you are in the beta, you’ll automatically get the new features.

RSS in mail makes perfect sense for a few reasons: 1) people already spend a lot of time in their Mail experience, why shouldn’t personally relevant content be there too 2) While you read RSS you are probably gonna want to forward good stuff you find 3) Hundreds of millions of users use Yahoo Mail, so if we want to reach the masses, we need to go where they are."

That third point is the biggie - millions more people use Yahoo! Mail than use the MyYahoo portal. And most of them probably haven't been directly exposed to RSS feeds yet.

I'll analyze this news fully tomorrow, but for now check out TechCrunch and Podtech.net for all the initial details.

Mobile Web browsers - Microsoft's downfall?: As we begin to use mobile devices more and more to access the Web, Microsoft's browser dominance may begin to ebb away. 2008-09 is predicted to be when the Mobile Internet hits big. So who are the early leaders in the mobile web browsing market? PC browser battler Opera is styling itself as "the world leader in mobile browsing technologies". In August this year, Opera Software launched Opera Mini - a browser for mobile phones. They also recently released a mobile AJAX Platform product, which impressed mobile expert Russell Beattie. Nokia has a product called Web Browser for S60, for browsing on a range of Nokia phones. Microsoft has its Smart Phone and Firefox has a mobile browser called Minimo. There have even been hints at a Yahoo! mobile browser.
[full story here...]

Browser Wars 2006 - Microsoft set to continue dominance: IE has been losing ground to Firefox over the past year and most tech bloggers (including me) report a higher percentage of Firefox than IE users. However in the mass market, IE is still by far the dominant browser. According to Web analytics company OneStat.com, as of late October 2005 almost 81 percent of Americans used IE, 14 percent used Firefox, and only a small percentage used Opera, Netscape, and all other browsers combined.
[full story here...]

1. Virtual Places
2. Weather Bonk
3. Diggdot.us
4. Flash Earth
5. Adactio Elsewhere
6. Where's Tim Hibbard?
7. Elicit
8. 2RealEstate Auctions
9. Flickrmap
10. Streampad

All the usual API suspects are included in these mashups: Google Maps, Flickr, del.icio.us, Amazon. I tried out Virtual Places and was impressed that it includes little old New Zealand. Here is my hometown of Wellington:

I've been checking out mashups from other sites too, particularly Ning.com. A couple of note are Restaurant Reviews With Yahoo! Maps and Anytown Marketplace With Maps, the latest version of Jon Aquino's craigslists-like mashup.

Also the media companies are coming on board, led by BBC Backstage but also washingtonpost.com recently released an excellent site called mashingtonpost.com. Some interesting mash-ups that people have done already on mashingtonpost.com: News Cloud (a tag cloud), Ripped from the Headlines! (a daily news quiz), world map interface, thumbnail quiz of Arts & Entertainment stories, and washingtonpost.com search results via RSS.

This is an exciting time to be experimenting with mashups, whether you're a publisher, a 'user' or an API-wielding company. As Yahoo's Matt McAlister put it, "the idea is to make your content mash up ready and to build incentives for people to use your content." In that spirit, I've (finally) freed my own RSS feed under the Creative Commons, plus I'm currently trying my hand at mashups. Anyone can do it, so why not give it a try?

"Ray Ozzie's memo indicates that Microsoft is still internally questioning the approach for Office Live. Should they web-enable traditional desktop personal productivity tools like Powerpoint? A web-based Office will be - should be - a much more collaborative suite of tools than its desktop equivalent. It won't simply be a re-hash of the desktop products - because to take advantage of the two-way, open and collaborative nature of the Web, Microsoft product designers and engineers will need to re-think Office functionality. 

Ray Ozzie more than anyone is certainly aware of that need, so it's interesting he pegs Office Live as a "portal for productivity". In the 90's a portal was known as a central place on the Web, where users could quickly access a variety of different services and websites. I think Ozzie may be extending the meaning of 'portal' to mean the Office Live suite of web-based tools and services.

The technologies he mentioned in the memo, RSS and XML, are often used nowadays to remove the necessity of a central portal website. With RSS for example, users can publish and subscribe to different forms of data. So with Powerpoint, the Office Live version of that tool could potentially become my portal to the Web for all presentation content that I have an interest in." [Read full article on ZDNet]

I'm interested in your thoughts on what Microsoft could do with Office Live, seeing as they don't appear to have settled on a plan yet.

"You can now set up your own Craigslist-style marketplace for free and without any coding (as the app owner, just drag-and-drop categories where you want them, then add, edit, or delete right there on the app).

When you clone it, it retains the categories youíll find on Craigslist, but you can also add, edit, or delete categories so your new marketplace app is relevant to your area."

I need to look into it more closely, but the concept sounds great. I only hope it can be exported to craigslist-less New Zealand! :-) Update: I'll be darned, there is a craigslist here.

In Gates' email, he outlines Microsoft's high level vision for Internet services:

"The broad and rich foundation of the internet will unleash a "services wave" of applications and experiences available instantly over the internet to millions of users. Advertising has emerged as a powerful new means by which to directly and indirectly fund the creation and delivery of software and services along with subscriptions and license fees. Services designed to scale to tens or hundreds of millions will dramatically change the nature and cost of solutions deliverable to enterprises or small businesses."

Ozzie's memo goes in-depth into the details of their strategy. I haven't yet digested it all, but his talk of competitors Google, Yahoo and Apple caught my eye:

"And while we continue to make good progress on these many fronts, a set of very strong and determined competitors is laser-focused on internet services and service-enabled software. Google is obviously the most visible here, although given the hype level it is difficult to ascertain which of their myriad initiatives are simply adjuncts intended to drive scale for their advertising business, or which might ultimately grow to substantively challenge our offerings. Although Yahoo also has significant communications assets that combine software and services, they are more of a media company and ñ with the notable exception of their advertising platform ñ they seem to be utilizing their platform capabilities largely as an internal asset. The same is true of Apple, which has done an enviable job integrating hardware, software and services into a seamless experience with dotMac, iPod and iTunes, but seems less focused on enabling developers to build substantial products and businesses."

Meanwhile, in 'official' company communications with the media, Steve Ballmer talks a little about their strategy with multimedia products like Xbox and Media Center - something which I have a particular interest in following (because I think they're going to be huge). Ballmer said:

"If you ask what will be the next very big business, I'd say probably tapped in there are the Live services and MSN, and then the Xbox and TV businesses. I mean, to be big numbers."

Interesting times...

"WeÔøΩre viewed as a Web 2.0 poster child (and subsequently pegged for representing many of the things broken about it). Following OÔøΩReillyÔøΩs Web2.0 Conference it seemed that the phrase became a dirty word ÔøΩ as a catch-phrase, once it caught on with a wider audience it seemed to lose all relevance or meaning whatsoever.. Not like it makes much difference, but weÔøΩve had a ban on the phrase in our office stemming from around the same time."

Nice monitor! Photo by foolswisdom

I'm quite happy for Flock to go back to their Open Source roots and shun the Web 2.0 hype machine. No use going the Kurt Cobain route and letting the meatheads and metalheads get you down. But don't hide behind your Mac monitors too much, guys - the Web 2.0 community still loves you! :-)

UPDATE: Ben Barren tried to shield my eyes from this horrid picture, bless him, but I couldn't resist peeking...

Noooooooo....