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Snipe vs Skype

14 SEPTEMBER 2005

Snipe vs Skype

This week's announcement that eBay has purchased internet VOIP telco Skype has gone largely unremarked down our way, apart from token concern that the threat to our telephone companies will increase. The disruptive side-effects of this deal are rather broader than that and deserve more informed discussion and debate.

First, some explanations may be in order. eBay, as you most likely know, is the 800lb gorilla of the online auction space, boasting some 150 million registered users worldwide and responsible for annual sales of US$40 billion. Skype, on the other hand, has 54 million members in 225 countries and territories worldwide (and, um, growing at the rate of 150,000 new customers EVERY DAY!) and provides voice communications via the internet - free for Skype-to-Skype services, at a fraction of the cost of traditional telco charges for services using the regular phone system.

eBay's official announcement of the purchase (for at least US$2.6 billion, rising to US$4.1 billion if certain performance targets are achieved) noted the following benefits through the acquisition:

* "eBay buyers will gain an easy way to talk to sellers quickly and get the information they need to buy;

* "eBay sellers can more easily build relationships with customers and close sales

* "in addition to eBay's current transaction-based fees, ecommerce communications could be monetized on a pay-per-call basis through Skype. Pay-per-call communications opens up new categories of ecommerce, especially for those sectors that depend on a lead-generation model such as personal and business services, travel, new cars, and real estate

* "PayPal (eBay's payments subsidiary) and Skype also make a powerful combination. For example, a PayPal wallet associated with each Skype account could make it much easier for users to pay for Skype fee-based services, adding to the number of PayPal accounts and increasing payment volume."

What does that all mean? First the trivial aspects - instead of only communicating during online auctions via email, buyers and sellers can interact via internet telephone. Suddenly trading on eBay gets heaps easier, especially for technophobes. Any problems? Just talk them through.

After that, things start to get interesting. Got any big ticket item to sell - car, house, travel, whatever? You could advertise it and see who responds - or you could buy qualified leads direct from eBay/Skype. Toyota Landcruiser searchers? Got 'em. Bali-bound? $X a lead. Want to break into a new market? Click/phone here.

Is this real estate agent trustworthy? Read or listen to her Feedback. Is this the best deal around? Compare with recent eBay/Skype sales in this area.

Want to buy anything over the phone? No need to give credit card details - just feed in a PIN number and PayPal/Skype will do the rest.

It's not too outrageous to envisage a near-future where a consumer walks into a local store with a Skype-enabled mobile, keys in the barcode for a fancied product (or painlessly captures the RFID code), finds a match amongst eBay sellers, haggles via Skype-phone for a better price, reaches agreement, pays instantly via PayPal and walks out the door again. He's bought the product, alright, but not from that unfortunate retailer - and it'll be delivered before he gets home.

It's an enticing picture for consumers - and for product suppliers tied into the system. Just another step towards the perfect, frictionless market. Shame about those stuck in traditional channels.

What can you do about it? Keep it here - we'll let you know as enhanced services roll out.

New Music TV Channel For Auckland

November 18 sees the launch of Auckland's newest regional TV channel, Alt. As the name might perhaps suggest, Alt is an "alternative music and entertainment station which aims to provide a home for those viewers disenchanted with mainstream television". Actually, we doubt they've got enough room for all those folks, but nice thought.

Alt will be broadcast on UHF Channel 62, targeting a potential audience base of 981,600 viewers, and is aiming to get a test signal out from the Sky Tower in October.

Who's behind Alt? Those fine folks who bring us George FM et al, under the tutelage of head of programming Thane Kirby and station manager Ricky Newby. The station will be located along K Road, right next door to Verona.

The channel, as you might expect, will target 16-35 year olds and is promising a mix of (deep breath) rock, electronica, hip-hop, funk, soul and jazz. Alt is looking for cornerstone sponsors to take it through the first twelve months, including:

* five Gold Foundation partners spending $15,000 plus GST per month for a minimum of twelve months (in return for an enticing package of goodies, details on request);

* three Silver Foundation partners at $10,000 a month;

* and an unspecified number of Bronze Foundation partners spending $6,000 a month.

All foundation partners are offered the opportunity of product placement within live content produced by the channel, an acknowledgement of the power of the PVR.

Music television is not exactly unknown to the citizens of Auckland - we've swayed to the sultry beat of Max and MTV in our time, and still get to sample C4, Juice and J2 along with the rest of the country - but Alt at least starts out with a definable point of difference. Given the unlikely success of George FM we'll give Alt the benefit of what would otherwise be a rather large doubt as to its likely longevity.

Where Were You In Two Thousand And Two?

Saturday night is a terrible time for an Election - or at least it's lousy for television coverage of the aftermath, as an orchestrated litany of lies emerges from the mouths of those with too much time to fill and too little tangible information to report. As we count down the hours until Saturday's triennial travesty, we amused ourselves by reviewing the events of 27 July 2002, to see if democracy was truly served last time we played Electionary.

Senior citizens were obviously keen to observe the political process as it ground on through the evening - an average of 36.9% of our elders Over 65 were tuned to TV One's Election Coverage on the night, 8.8% to TV3.

Those aged 40-64 also carried out their civic duty respectfully - 21.8% showed up on TV One, 7.3% on TV3.

The 18-39s, however, must have had a few better offers on the night and could only manage token viewing: 8.1% dragged themselves in front of TV One's coverage, 6.2% supporting TV3.

This year TV One and TV3 will again try our patience with interminable pre-results pontificating. They'll be joined (at a more respectable 9.30 start time) by Auckland's Triangle Television, evaluating the results through the viewpoint of Auckland University student mag editor-elect Ryan Sproull, aiming for "a blend of serious information and intelligent humour". Will they be the only broadcaster to attempt such a difficult task?

If only satire were still alive and well in Godzone - what fun we'd have on the night!

The Future Is In Their Hands

The entire world of free-to-air television rests on an implicit assumption - that consumers will be willing to accept an ongoing diet of advertising content in return for getting their programmes supplied for free. That particular worldview has taken a bit of a hammering in recent years, and the once and future PVR is threatening to destabilise the whole house of cards.

But wait - there's a glimmer of hope on the horizon, and it comes in the form of a handheld device called the Gizmondo. On trial in the United Kingdom since March, the Gizmondo - a combination video game console, movie & music player, web browser, text message and email sender, camera and GPS device - launches next month in the USA, in two flavours.

Flavour Number One, $400, is just what it seems - a killer handheld.

Flavour Number Two, $229, just could be the future of advertising. In return for a discounted pricetag, this Gizmondo is ad-enabled and set to receive no more than three 30-second messages a day, geo-targeted through the GPS device. A barcode or coupon will sometimes accompany the ads, along with mapping directions on the nearest location of a participating retailer. Gizmondo users can head to the retailer and redeem special offers, closing the loop between advertising and sales.

If it delivers as planned, the Gizmondo just might usher in a new world - not just for themselves but for other media as well. Dominion Post without ads? That'll be $10 please. Or get it free with the compliments of [your brand here]. Shortland Street Extended Edition, downloaded straight to your PVR, $2 ad-free, 50 cents with messages tailored for you.

Fingers crossed, adland, this Gizmondo's for you.

ABOUT MEDIACOM MEDIACOM, with offices in 80 countries, is one of the world's largest and most respected independent media planning and buying organisations.

We create media solutions that build business for a wide range of local, regional and worldwide clients.

With $13 billion in global billings, a commitment to strategic insight, total communications planning, tactical media brilliance and tough but creative media negotiating, MEDIACOM provides unsurpassed value in today's chaotic media marketplace.

ENDS

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