Internet Revolutionaries [7:31 pm]
On the face of it, file-swapping and telephony have little in common. But both, it turns out, can be implemented using “peer-to-peer” technology, in which PCs connected to the internet via broadband connections organise themselves into a network. It is then possible to send data, whether media files or phone calls, from one PC to another efficiently. Many of the lessons that Mr Zennstrom and Mr Friis learned from building the file-sharing system behind KaZaA–in particular, the idea that some computers should act as “supernodes” to speed the transfer of data–could thus be applied to internet telephony through Skype. The supernodes, for instance, help to eliminate the delays and drop-outs that can plague internet telephony.
[...] Mr Zennstrom thinks that merely linking traditional and internet-based phone systems is an inelegant halfway house. He is more radical, believing that all calls will migrate to the internet and be provided via software alone, with no need for any dedicated infrastructure. Telephony will be another free internet service, like e-mail and web browsing are today. (Skype plans to make money by charging for extras such as voice-mail, call waiting, multiple lines and calls to the few die-hards who stick with pre-internet phones.) If he is right, the traditional fixed-line voice business will shrivel and die, and telecoms incumbents will be reduced to selling broadband access, and little else.
[...] As with KaZaA, it may be that Mr Zennstrom has correctly identified an important trend, but that the software he has written to exploit it will not ultimately prevail. If so, he and Mr Friis will have to find another industry that is ripe for disruption using peer-to-peer technology. If you are a chief executive in a stodgy, old-fashioned industry, watch out.