Outage takes out Skype, recovery taking hours

NEW YORK Wed Dec 22, 2010 5:30pm EST

Skype CEO Josh Silverman speaks at a news conference during his first official visit in Taipei June 23, 2010. REUTERS/Pichi Chuang

Skype CEO Josh Silverman speaks at a news conference during his first official visit in Taipei June 23, 2010.

Credit: Reuters/Pichi Chuang

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NEW YORK (Reuters) - Internet phone and video service Skype went down in a global service outage on Wednesday, underscoring a weakness of the free online communication tool.

Skype, partly owned by Web retailer eBay Inc, said some users were having problems signing on. Users in the United States, Asia and Europe complained of the outage on social network site Twitter.

In its Twitter feed, the seven-year-old company apologized for the disruption and said it was investigating the cause. Around 3:30 p.m. EST, it said the service was returning to normal, but that it may take several hours for everyone to be able to use it again.

The so-far unexplained outage, just days before the Christmas holiday, marked the latest blow to the service's reputation.

Dropped calls and service quality have long been seen as a weak point for Skype, which offers free voice and video services between users as well as low-cost calls to landlines. It had 124 million users as of October.

The company's last major outage occurred in August 2007 following a routine software upgrade.

Many consumers have been reluctant to cut off their landline and rely solely on services like Skype due in part to questions about its reliability. Such concerns, along with worries about online security, have slowed Skype's expansion into the business market.

It now also faces competition from rival online phone providers such as Google Inc, which lets its users make calls through their Gmail accounts, and high-end videoconferencing tools like Cisco Systems Inc's "umi" service.

Skype is expecting to raise up to $1 billion in an initial public offering, sources familiar with the matter told Reuters last month. One source has said the IPO will likely come sometime next year.

Skype was founded in 2003. EBay bought it in 2005 for $3.1 billion.

In November, eBay sold a majority stake to an investor group including Silver Lake, Canada Pension Plan Investment Board and Andreessen Horowitz for $1.9 billion in cash and a $125 million note. EBay retained a 30 percent stake.

(Reporting by Ritsuko Ando. Editing by Robert MacMillan and Matthew Lewis)

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Comments (2)
MarieB wrote:
If you want a Skype alternative (at least for video calls), use http://www.FaceFlow.com, very easy and free even for group video calls… It’s in Beta still but it works well right now and very promising. You can also learn more there : http://www.faceflow.com/skype-alternative

Dec 22, 2010 8:25pm EST  --  Report as abuse
This is an unfair and uninformed artcicle by Ritsuko Ando and Matthew Lewis. Let’s consider:
1) The Skype service is free and 99.99999% of the time between good and excellent.
2) The calls that need to be paid are a bargain by any standard.
3) Land line and cellphone services in the U.S and abroad also experience outages from time to time.
4) Most important, Skype make it possible for millions of people to communicate with each other, people who otherwise would not be able to do so because of financial considerations.
5) Personally, I would rather pay Skype than AT&T, for example. The charges at AT&T are outrageous and their record keeping so bad that most of its customers overpay for just about all the services they offer and specially their cellphone service.
6) I humbly suggest to Messrs. Ando and Lewis to conduct a customer satisfaction survey between the users of Skype and the customers of AT&T to see how people feel about the two companies.

Dec 23, 2010 7:35am EST  --  Report as abuse
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