Skype, EMI Partner In Marketing Campaign Effort

Internet phone company Skype and music label EMI have joined forces for a new promotion targeting fans of the British music group Coldplay.

For the initiative, Skype and EMI invited Coldplay fans who have registered at the group's Web site to create a standout voice message to Coldplay in 20 seconds or less. Those driven to respond must first download Skype's software to their computers. Once the promotion ends in March, Coldplay--which recently released the new single, "Talk"--will choose the best response, and then use Skype to call the winner for an Internet phone chat.

"Simply click on the Skype Coldplay button to leave a message and your Skype Name," the Skype Web site explains. "The band will have a listen and whoever leaves them the best or most interesting message will win a call with Coldplay over Skype."

Saul Klein, Skype's vice president of global marketing, said the initiative aims to focus attention on Skype's personalization features--launched officially in December as part of Skype 2.0. "This highlights our personalization tool that lets users buy ringtones and pictures, which is an area that's getting more and more interest from entertainment companies," said Klein.

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Pictures that accompany user messages--also known as "avatars"--and ringtones are currently going for $1.20 each on the company's "Personalize Skype" store site.

Skype has had no difficulty attracting users. Its software was downloaded by over one hundred million consumers within a year of its initial debut in mid-2004. When Web auctioneer eBay agreed to buy Skype in September for $2.6 billion, it claimed 54 million users. Skype now claims 70 million users worldwide, according to Klein.

Online traffic to Skype has increased significantly in the United States since last year--from 385,000 unique users in July 2004 to 1,490,000 this July of this year, according to comScore Media Metrix.

But attracting revenue is another matter. Ian Fogg, Jupiter Research's VoIP analyst in Europe, estimated Skype's total revenue in 2004 to be about $7 million, in a telephone interview with OnlineMediaDaily upon the acquisition announcement. The Luxembourg-based company said in September that it expects revenues of $60 million this year and more than $200 million in 2006, but isn't currently profitable.

Paid personalization features is a new business for Skype, and is by no means the company's main source for revenue, said Klein. The bulk of its revenue comes from its premium voice- and video-over-Internet services, which allow users to make calls to or receive calls from regular phone numbers.

The company faces still competition from major players like America Online, Google, Yahoo! and Microsoft. The deal with EMI is Skype's first major promotion since being acquired by eBay.

With Skype 2.0, the company added free one-to-one video calling to its offerings. It also added the Skype toolbar for Microsoft Outlook, allowing one-click calling to Outlook address book contacts.

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