Skype's Voice over Internet Protocol (VoIP) technology enables 600 million users around the world to place phone calls via the internet for free or from computer to phone, for pennies on the dollar, far less than traditional landline and mobile phone rates in the UAE.
Skype, however, is banned in the UAE and its website, www.skype.com, is blocked by authorities. In an exclusive interview, Gulf News speaks to Rouzbeh Pasha, Skype's Head of Middle East and Africa, to discuss the future of Skype in the Middle East and a possible presence in the UAE amid newly relaxed regulations by telecom authorities.
Pasha was a panellist yesterday participating at the Middle East Communications 2010 conference in Abu Dhabi.
In March, the Telecommunications Regulatory Authority (TRA) announced that it had revised for the first time its policies in order that "licensees may offer VoIP as a technology." The TRA said in a statement that "offering VoIP is considered a regulated activity which requires a licence. Therefore, only licensees may provide VoIP services... However, they [VoIP companies such as Skype] can always approach and collaborate with the licensees to legally provide their services." What is Skype's view on the latest TRA announcement and does this mean that expatriates should look forward to legally using Skype service in the UAE soon?
Obviously, this is going in the right direction. However, it is a small step. If you look at the potential UAE has, it is great. From our point of view, it's not really about any one country specifically. I'm in charge of a big region, [the] Middle East and Africa; it's 1.3 billion people with 300 million Arabic-speaking people.
If you look at what Skype brings to these people, this is an amazing product, it helps people get close to their loved ones. If you look at the average number of contacts people have on Skype, it's less than 10.
These are people who you want to see their face. Thirty-four per cent of all Skype calls are video calls. On special occasions such as Ramadan and New Year, more than 60 per cent of all our calls are on video. This helps [our users] stay in contact with people who matter.
Can you confirm that Skype is in talks with TRA or etisalat, du, Thuraya and Yahsat, to bring your VoIP services legally to the UAE through a partnership that would see a portion of Skype revenues stay in the country?
Usually we don't comment on any financial discussions we have with government agencies. However, we do work with partnerships.
We are a Luxembourg-based company. All of our servers are based there. We do work with local partners. We don't comment until we have something we can report on. Our strategy is to globally work with partners. A lot of potential partners have reached out to us. We're in discussions with quite a few.
There are reports that suggest Skype could be up and running freely in the UAE within the next two years. Is that optimistic?
I don't want to speculate. The sooner that everything can be fine, and... Skype can be everywhere, that will be better. But we will have to have relationships in place.
We are working toward that goal. It has to make sense. It is working in every part of the world and it should be working in the Middle East and Africa. But I don't want to put a timeline on it.
Is it your opinion that if a less expensive alternative was given to expatriates to call abroad, more Skype phone calls would be placed, creating higher revenues that would be shared in a partnership with a traditional UAE telecom partner?
How people communicate has really changed. People used to communicate only through voice calls. The device you hold in your hand now does a lot of other things including video. You can read the news on it, talk to a colleague, and also because of this development people aren't confined to voice any more.
Up to 50 per cent of calls depending on the occasion are done on video, a paradigm shift from low-quality voice on the other end. This is what technical innovation has brought us. If you don't upgrade your business model, you will end up losing the whole lot.
Working with a company like Skype helps future-proof your business model. In the short term you would be able to make additional money on what you are doing. You would be looking at making more money on data than on pure voice.
Pure voice is a disappearing thing. As more tools become available to you, you choose more online things. It's about the quality. The volume increases so much that you are making more money. This is an opportunity for... operators to make more money.
[Skype] is an application that drives the user to go get a data subscription, broadband subscription or mobile subscription so that they can use it. It's like you have a fast car and then going through the toll road to use it.
This region is as promising as any other region especially if you look at how the ICT trend is growing in the Middle East and Africa. The average speed of internet access is increasing. Some of the youngest and most tech-savvy people are living in this region. It really is a high growth region in all aspects of online services and Skype is one of them.
There are reports that Skype is already hunting for office space on Shaikh Zayed Road in Dubai to set up [its local] headquarters in the UAE. Can you confirm this?
We're looking at setting up a regional support office in the Middle East. It will be a representative office for Skype to support marketing and develop business activities in the region. We will announce soon which country it's going to be. We're not commenting yet where it will be.
We are an online company so that whatever we do is online. A geographical presence is to reach out to partners. It's not going to be an operation out of here, not like Blackberry selling out of an office. This will be closer to partners in the region. It will be this year, sometime this year. This is for us to show the long-term view we are taking in the region. Even though our software is available in every corner of the world, we have very few offices.
Dubai has always been a business hub and in most recent years has become an international destination to conduct commerce. Does Skype believe that less expensive calling rates internationally would improve affordability and access to other global centres for small businesses, exponentially increasing the flow of capital and trade into the UAE?
Totally. It is one of the main reasons that Skype can benefit the region and this country in particular. If you can use Skype as an official tool to communicate with customers and suppliers, it can give you a tool to be more efficient.
In economic development, communications is one of the key elements. This is really a global trading hub. You have suppliers in the Far East and customers in the Far West. You have to communicate with people. The easier you can communicate the more efficient you can be.
In the long run, it is one of the basic components for economic development and one way for businesses to become more profitable and more sufficient. If that happens, it does benefit the total economy of a country.
As the largest VoIP provider on the planet, what kind of numbers has Skype been enjoying in recent years?
We recorded 8 per cent [of international calling minutes] in 2008, 12 per cent in 2009. Skype was one of the companies driving the increase in total volume. Not only did we increase our share, but we also helped increase the total volume of calls. We now have 600 million users globally.
We just celebrated the concurrent logging in of 20 million users at the same time. This shows you the power of the technology. We do want to be seen as a company that breaks down barriers, this is one of the driving principles Skype has. We want users to feel part of the global community. If you are online, this is a tool that enables people to communicate wherever they are. This is the first time you can do it so cost-efficiently. Here this is really using the power of the internet to offer these services at a very low cost.
With an estimated 65 per cent of the Middle East population under the age of 30 constantly connected through handheld devices and laptops, do you see Skype emerging even stronger in coming years over traditional telephone platforms?
Skype is going to be one of the strongest platforms for communication online. It will allow users to do more online communication rather than single-device use. You log in, you check your e-mail, your news, you Skype your friend, do whatever you want. This region has great potential. The ICT is catching up now, it is improving and is great. People can get online faster than before.
VoIP technology provider aims to become a legitimate way to communicate with customers and suppliers and is currently gearing up to set up a representativeoffice in the Middle East before the end of the year
- 600m: number of Skype users worldwide representing roughly nine per cent of the world's population
- 20m: Skype recently celebrated a milestone in its history with 20 million Skype users logged on at the same time
- 34%: of all Skype callsare video calls
- 54b: Skype's share of 406 billion international calling minutes logged last year worldwide
- 7: Skype was founded sevenyears ago in Luxembourgh
