Skype,whose software lets users make long-distance phone calls using their computer and an Internet connection, said Aug. 17 that a software problem continues to stymie its free service for millions of users worldwide.
Skype, a division of online auction site eBay, is one of a host of software providers of an increasingly popular technology known as VOIP (voice over IP), which enables users to communicate with each other through phone calls, instant messages and videos over computers.
A Skype spokesman deferred questions about the outage to several blog posts by Skype engineers. Skype spokesman Villu Arak said in a blog posted Thursday at 10 p.m. that the problem was not due to a crash, cyber attack, or maintenance performed two days ago on the companys billing system.
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Arak attributed the outage to a "deficiency in an algorithm within Skype networking software. This controls the interaction between the users own Skype client and the rest of the Skype network."
"We expect this to be resolved within 12 to 24 hours," Arak wrote. "Meanwhile, you can simply leave your Skype client running and as soon as the issue is resolved, you will be logged in.
Progress continued through 11 a.m. EST Aug. 17, when Arak blogged that Skype is stabilizing. "An encouraging number of users can now use Skype once again," Arak wrote. Arak added that this process may continue throughout the day.
Skype engineers declined to say how many users were affected, but it is believed to be a large majority of the companys roughly 220 million users, who either experienced delays logging in or couldnt log in at all. Skypes forum siteis littered with complaints about the iffy service.
Analyst Stan Schatt, who covers VOIP for ABI Research, said any outage from Skype is serious, noting that he knows of a number of technology businesses that are purely running on Skype, including at least one analyst firm.
"Obviously, its a very serious issue," Schatt said. "When your phone goes down your business goes down."
Such issues are one reason why VOIP wont completely replace cell phones, Schatt added.
Forrester Research analyst Sally Cohen agreed with Schatt about how the outage may harm businesses.
"The outage is perhaps more devastating to the businessmen or women who rely on Skype for their business voice service, for example, while on the road," Cohen told said. "For consumers, Skype is not positioned as a landline replacement, so I dont see many consumers being completely put out by the software issues."
As far as damage to Skypes image in the marketplace, Cohen said a large-scale, long-term outage could have detrimental effects, scaring off prospective enterprises weighing whether or not to use Skype for their communications.
Still, millions of consumers are using VOIP to save on traditional phone bills, and VOIP providers and some enterprise software makers see the real sweet spot for success in hooking up businesses with VOIP access. IBM, Microsoft and Oracleall support VOIP in their collaboration software packages.
But overall VOIP needs some serious improvements before it can infiltrate the mainstream market. For one, the call quality of VOIP services has generally not been as good as that of traditional phone lines.
Moreover, call completion rates are low thanks to the NAT (Network Address Translation protocol), which involves rewriting the source or the destination addresses of IP packets or both as they pass through a router or firewall. Also, the user interface is typically too technical for less savvy computer users.
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Still, Skype and its rivals keep trucking. Skype competes with services from market leader Vonage, as well as services from incumbent communications carriers Verizons VoiceWing and AT&Ts CallVantage service .
But Skype aims to differentiate itself from those vendors by offering some free services, which include VOIP calls and video calls between users on Skype.
The company also offers Skype for Business, which includes the free calling and other features of the standard Skype service, but also includes Windows Installer and stronger security for business users.
Skype supports Linux, Windows, and Mac OS X operating systems.
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