Skype's Big Challenger is In-App Communications

Skype is a great communications tool--if you’re living like it’s still the 2000s. In 2015? Not so much. On the one hand, Skype is being threatened by other, more modern OTT players--WhatsApp, Line and WeChat, to name a few. But it is facing a far bigger threat: Much of its utility can--and many would say should--now be embedded right inside the apps we use daily.

A decade ago, Skype had it all when it came to our communications needs and expectations:

  • It was the only game in town that wasn’t a telco – if you wanted to communicate with others but didn’t want to pay the fees of a carrier, then Skype was the way to go.
  • It was free to use, for the most part.
  • It had an address book, where all of your friends and business contacts resided.
  • It showed your contacts’ presence and availability.
  • You could prod your contacts with a text message before calling.

Today, Skype and Skype for Business can do all that, plus run on mobile devices. And, just recently, Skype added the ability to run natively in the browser, courtesy of a protocol called WebRTC.

WebRTC isn’t new, but isn’t really old, either. WebRTC was announced about four years ago, to enable real-time communications inside the browser--for example, anabling users to open a voice or a video chat session with anyone from a website. WebRTC has many other use cases,as well, but, for the most part, people see it as a way to enable voice and video calls on the Web from a browser.

Google Hangouts migrated to WebRTC more than a year ago, and Mozilla introduced its Hello service inside Firefox just a short while later. To date, over 800 vendors have adopted WebRTC in one form or another in their services.

Those 800 vendors? They are the real threat to Skype--the death-by-a-thousand-cuts scenario, where no single vendor ends up displacing Skype (though there are a few serious contenders in that area already), but rather a large number of other vendors stripping the utility of Skype for its users.

Change of Context

To understand the process taking place, one needs to understand what Skype sessions are used for. When you want to talk to someone, you can pick up the phone and call them or you can Skype them. Doing one or the other requires a change of context. You were doing something--say, working on a document--and then decided you needed or wanted to speak with someone. So you switched to your phone or opened up Skype.

In today's world, when what you do with your devices and apps is woven very tightly into your work and personal life, that change in context is like slamming the brakes on your car.

Instead, what happens when the dating service you use offers the ability to connect to your potential significant other directly from the service? Or that project management tool you use to synchronize with a contractor has voice or video conferences as part of its service offering? Would you put in the effort of exchanging Skype IDs to make a call, or just click to connect?

Let’s look at two instances in which contexts and communications are being embedded into applications--and theoretically being taken away from Skype.


HipChat, an enterprise messaging service by Atlassian, posted a piece on its blog cheekily titled Looking for a Skype alternative? We got you.

“HipChat is the business and team alternative to Skype," states the post, by Jessica Abelson. "While Skype was built for consumers, HipChat was built just for teams. HipChat provides teams chat, file-sharing, and Integration for free, so that no matter your budget, your team can stay connected and productive.”

Last year, at the first Kranky Geek event, HipChat’s Jonathan Nolan explained why the company added WebRTC (and video chat) into HipChat: In short, "anytime we found ourselves moving the conversation outside of HipChat, we got frustrated."

And that’s the key. Consider HipChat an application of sorts--in this case, private group chat for teams to collaborate. When I think of HipChat, I think of its main utility around text messaging and sharing of work files. Having voice and video calling in there, too, means easier collaboration.

Upwork vs. Skype

Upwork, the result of a merger between Elance and oDesk, is probably the largest freelance talent marketplace. Need a design done? A text edited? A website developed? You post your job on Upwork and hook up with someone in its vast network of freelancers to get the job done.

The process itself usually requires messaging, which happens inside Upwork--no need to trade email addresses and communicate. But what happens when text just isn’t good enough? As with HipChat, there’s value in having further interaction take place within Upwork itself. That's why when Upwork was announced, so, too, was support for video as part of a new real-time group collaboration tool.
If you are running projects in Upwork, there’s no real need to exchange a Skype ID with your contractor to communicate: You can just reach out with the click of a button inside the Upwork website.

Everyone Wants to Own the Customer

It is happening elsewhere as well. Services are adding these interactions embedded within their own User Experience. It started off with simple text chat being embedded, and now it is happening with voice and video chat capabilities. WebRTC is to "blame" for this: It reduces the barrier of entry to this domain, democratizing voice and video calling.

Developers today can choose from a wide range of alternatives when it comes to adding WebRTC into their services. They can self develop right on top of WebRTC, use third-party open source frameworks or commercial frameworks, or use a communication API service. Twilio, for example, offers WebRTC APIs, and a large number of other players are making these types of integrations even simpler.

The future of communications is inside apps. Now that voice and video calling is no longer a service but rather a feature, we will see it embedded everywhere--and not just as a stand-alone app in our phones.

Be sure to read the next API Strategy article: How to Manage the Risk of Losing API Access