Skype in Taiwan

Skype is in Taiwan, and I'm sure its presence isn't going down too well with the folks at Chung-Hua Telecom, Taiwan's part state-owned telecommunications provider. Chung-Hua's staff, who had it so good for decades and charged the living daylights out of its customers, are going on strike in protest over government plans for further privatisation.

You'll often hear people talk about Skype: "It's not that good. It's not as clear as the phone." Sure, that is true, but what they are forgetting is that Skype is competing against non-consumption: many of the people who use Skype would probably not have made any phone call at all, using instead e-mail, fax, or a letter.

It is Skype's relatively poor technical performance that makes it such a danger to Chung-Hua. Chung-Hua will be motivated to ignore Skype, thinking that they can concentrate on more-demanding customers, such as businesses, and move upmarket.

One thing's for sure, the technology that powers Skype will only get better, and when this happens, Skype will really start to eat into Chung-Hua's revenues. It is going too far to say that companies like Skype will "destroy" telecoms providers (just like CDs haven't "destroyed" vinyl), but they will certainly change the way they currently operate.