Skype is Killing it On Long Distance

Skype voice traffic is expected to grow by 45 billion minutes in 2010 to more than twice the volume added by all of the world’s phone companies combined, according to research from consulting firm Telegeography.

In 2009, Skype’s growth exceeded long distance voice-minute growth for the first time, as adoption of the company’s P2P VoIP technology took off. Today’s data shows that Skype’s momentum is continuing to grow, which means the small portion of revenue that traditional phone companies bring in for long distance could soon be a relic, like wireline revenue and per-minute domestic calling charges. According to the Telegeography report, international call traffic grew an estimated 4 percent in 2010, to 413 billion minutes — down from 5 percent growth in 2009, and way off from the 15-percent average growth rate shown during the previous two decades. Meanwhile, Skype has hit 102.5 billion minutes, which means one out of five voice minutes are now going to Skype! Telegeography Analyst Stephan Beckert put it best saying, “Demand for international communications remains strong, but ever more people are discovering that they can communicate without the services of a telco.” Beckert noted in an email to me, however, that the telcos aren't losing out on huge chunks of change.