Skype Bans Mean Big Profits For Incumbent Telecoms

from the ol'-cash-cow dept

Last week we noted that Jordan had recently banned Skype in what looked like a pretty obvious ploy to aid the country’s incumbent telecom monopoly. Jordan ultimately reversed the ban, but does banning Skype actually have the desired effect? Sadly, it appears it does. In neighboring UAE, the government also banned Skype, much to the chagrin of Dubai’s many ex-pats, and much to the delight of Etisalat, the country’s main telecom operator. Following the ban, Etisalat’s profits jumped dramatically, 41% in the recent quarter. There may be other factors involved, such as the ongoing economic boom in the region. But when you’re selling international calls at $.75/minute, and your competitor that was selling the same thing for $.02/minute gets shut down, it clearly helps.


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Comments on “Skype Bans Mean Big Profits For Incumbent Telecoms”

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15 Comments
chris (profile) says:

Re: Beyond Skype

Surely Skype users can move to another similar service. Drag their main contacts with them

as it stands right now… no.

skype is a closed protocol, unlike SIP, and so you have to use the skype software and the skype protocol to connect to skype contacts. SIP is an open standard and you can use several devices, clients, and providers.

perhaps skype can provide some sort of ENUM service and register with sip broker.

Sanguine Dream says:

Big money...

So this is the “free market” economy that people bitch about all the time. Build up a strangle hold on some market and when a competitor arises you just ban them. If this really was free market then these big businesses would have the balls to take on these competitiors but offering superior service instead of buying government intervention.

Solo says:

Re: Re: Re: Big money...

Mmm… not exactly. If anything the telco company of UAE and Jordan are government owned and operated. And when I mean government, I really mean they belong to the king, or his cousin, or uncle. And competition is better reserved out of the realm of the King’s possessions.

Like I said earlier: not a democracy, not an open market, not capitalistic, nothing of what you describe.

Regarding your concern of money buying political influence and squashing competition, what planet do you come from? 6,000 years of documented history of such practices. I’m sorry if you just opened your eyes, but this is how it works.

PULPO says:

Re: Re: Re:2 Big money...

Solo, I think you’re missing his point. He is refering to things like Ebay banning Google Checkout, not just what is going on UAE on other closed markets.

He is speaking on a broader level, where if some company or goverment feels like they can’t compete in a free market then they just ban they other product.

Sanguine Dream says:

C.R.E.A.M.

Cash Rules Everything Around Me…

So this is the “free market” economy that people bitch about all the time. Build up a strangle hold on some market and when a competitor arises you just ban them. If this really was free market then these big businesses would have the balls to take on these competitiors but offering superior service (or better prices) instead of buying government intervention.

david (user link) says:

nasty

Telecom, the incumbent monopoly telco of New Zealand just shapes international skype traffic in such a way as to make it worthless, so that you have to purchase Telecom’s own VOIP solution.
Nasty trick really – I can’t use skype to anyone on Telecom’s network from TelstraClear’s network because Telstra refuses to pay a peering fee to Telecom – even though I live in the same country. I get lag that’s several minutes at a time!

dawnzig says:

Re: Will they also be banning calling cards...

Ironically, when I visited The Bahamas several years ago, I had set it up beforehand w/AT&T so that my wireless minutes wd be $0.59 USD.
Not cheap, but not exorbitant like I heard it was in those islands.
I also bought several calling cards “guaranteed” to work from any country.
Well, nothing worked from there.
I couldn’t even get ahold of AT&T’s service dept. on my wireless no matter what I dialed, only the Bahamiam telco.
A 7 minute call was $50 USD!!!
The cards didn’t work and we had to buy ones sold there for $1 USD per minute.
Reverse charging on a home calling card didn’t work either-because you couldn’t get ahold of any outside networks— and they tried to charge $79 USD for 14 minutes!
(I disputed all charges and never had to paid ’em.)
But how’s that for a monopoly & gov’t bans?!
I’ll never go back there because it’s such a rip-off like that with EVERYTHING.

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