Niklas Zennström and Janus Friis (Skype)

Niklas Zennström and Janus Friis
Niklas Zennström and Janus Friis

Skype was an extremely popular software application that allows users to make voice calls over the Internet, as well as instant messaging, file transfer, and video conferencing.

Its development in 2002 was financed by the Skype Group, founded by Swedish entrepreneur Niklas Zennström and Dane Janus Friis, who had already an experience in venture IT business, founding in 2001 Kazaa Media Desktop (once capitalized as “KaZaA”, but now usually written “Kazaa”)—the famous peer-to-peer file sharing application. Skype calls to other users of the program and, in some countries, to free-of-charge numbers, are free, while calls to other landlines and mobile phones can be made for a fee ($2.95/month gets you unlimited calls in the USA).

The name Skype came from one of the initial names for the project—SKY PEer-to-peer, which was then abbreviated to Skyper. It appeared, however, that some of the domain names associated with Skyper were already taken. Dropping the final r left the current title Skype, for which domain names were available.

The domain names and were registered in April 2003. In August 2003 was released the first public beta version of the program.

The code of Skype was written by Estonian developers Ahti Heinla, Priit Kasesalu, and Jaan Tallinn, who had also originally developed Kazaa. They used several IDEs and languages—Delphi, C, and C++, developing initially Skype clients for several OS—Windows, Linux, and macOS.

Skype is a real nightmare for phone companies because it provides almost free phone services to each user with a Skype program and Internet connection. With the popularization of wireless networks, the business of pure phone service providers is going to decline. Moreover, Skype is now running not only on computers but also on many models of mobile phones and smartphones.

Skype uses a proprietary Internet telephony (VoIP) network, called the Skype protocol. The protocol has not been made publicly available by Skype and official applications using the protocol are closed-source. The main difference between Skype and standard VoIP clients is that Skype operates on a peer-to-peer model (originally based on the Kazaa software), rather than the more usual client-server model. The Skype user directory is entirely decentralized and distributed among the nodes of the network, i.e. users’ computers, thus allowing the network to scale very easily to large sizes without a complex centralized infrastructure costly to the Skype Group.

Skype uses a secure communication protocol, as encryption cannot be disabled, and is invisible to the user. Skype reportedly uses non-proprietary, widely trusted encryption techniques: RSA for key negotiation and the Advanced Encryption Standard to encrypt conversations. Skype provides an uncontrolled registration system for users with no proof of identity.

Now versions of Skype exist not only for Linux, Mac OS, and Windows but also for Maemo, iPhone OS, Android, and even Sony’s PSP.

In April 2006, the number of registered users reached 100 million. In 2009 this number reached 530 million. In January 2010 were reported over 22 million concurrent Skype users. As of 2022, 40 million people still use Skype on a daily basis, and over 300 million people use Skype every month.