VoIP and social networking

MySpace enhanced with Skype telephony

SAN FRANCISCO (AFP) - MySpace and Skype announced Tuesday they are meshing social networking with Internet telephony, creating the largest voice-connected online community on Earth.

The partnership comes as MySpace rival Facebook gains ground and Internet telephony pioneer Skype struggles for ways to profit from the technology.

Skype will craft its voice over Internet protocol (VoIP) into MySpace instant messaging software worldwide by December, letting website members easily call each other's computers free of charge.

MySpace says it has 110 million active monthly users and that 220 million people have Skype accounts.

Approximately 25 million MySpace members use its instant messaging service.

MySpace members will be able to link profiles, photos and animated online personae, referred to as "avatars," to the Skype feature.

"Internet calling is the natural next step for how our members communicate with each other," said MySpace chief executive Chris DeWolfe.

The MySpace IM with Skype service will be available to website members in all countries it serves, except Japan, China and Taiwan due to constraints from existing deals.

MySpace users will have the option of using for-fee premium Skype services such as call forwarding, voice mail, and calling from computers to landlines or mobile telephones.

"Wherever people are hanging out on the Internet they should be able to use Skype," Skype director of business development Scott Miller told AFP.

"MySpace is a great hangout so it is a great way to get Skype to people hanging out on MySpace."

Alliance talks date back to before California-based eBay bought Skype and New York-based News Corporation acquired MySpace, according to Smith.

Engineers from the companies began work on the project in July after "all the pieces came together," according to Kyle Brinkman, vice president of product development at MySpace.

"I think it shows our chops a little as far as technology, not to brag, which helps us with our foothold in Silicon Valley," Brinkman told AFP.

Los Angeles-based MySpace opened an office in San Francisco this week to tap into Silicon Valley engineering talent and creativity.

The Skype service built into MySpace will be a test, or beta, version. It will be part of instant messaging software downloaded by new users and be available as an upgrade to existing MySpace IM users.

"The partnership will create the world's largest VoIP community," Smith said.

"It is a natural fit. MySpace has been the place to communicate on Internet while Skype has been the way."

Despite its global popularity, Internet telephony has not become a gold mine for Skype.

Popular online auction firm eBay, which bought Skype two years ago for 2.6 billion dollars, attested to that fact early in October when it devalued the once-darling firm, knocking 1.43 billion dollars off its value.

Analysts interviewed by AFP wondered how Skype can convert its extraordinary global popularity into hard cash and corporate revenue.

Skype fans as far away as China download software that enables them to make telephone calls from one computer to another anywhere in the world for free.

A problem for the company has been that few of those fans use additional for-fee services.

People also prefer combination telephone, Internet, cable television deals offered by major telecommunications companies to relying on Internet telephony firms for long-distance calling, according to iSuppli analyst Steve Rego.

EBay's original plan was to integrate Skype into its online auctions so, for example, sellers and buyers could call each other instantly using their computers.

This course seems to have been abandoned by eBay.

Skype has heavyweight competition in the online telephony arena. Google, Microsoft, and Yahoo have woven VoIP calling into their online messaging services.

From Yahoo! news