Facebook video deal a mixed bag

Michael Carroll

Facebook video deal a mixed bag

July 11, 2011

Facebook’s collaboration with Skype to offer video calling to its 750 million users has pros and cons for the industry.

On the one hand, the collaboration brings the prospect of a deeper integration between Facebook and Skype’s new owner Microsoft, Ovum principal analyst Eden Zoller notes. Such an alliance would be a powerful force and certainly “one that will keep Google awake at night.”

Zoller believes video chat on Facebook will develop into a “strong mobile play given that at least half of Facebook’s user base interact with the social network via mobile.” The analyst also notes that Microsoft “is determined to take Skype in this direction.”

And therein lies the problem with the marriage. Video usage could well soar as a result, and if 375 million subscribers suddenly start chatting on mobile networks, the result could be a collapse of those networks.

The problem applies equally to fixed line services, according to Tom Mock, senior vice president of marketing at network optimization firm Ciena. He predicts problems with soaring video usage even “if only a proportion of Facebook’s 750 million users take up the service.” The result will be degradation of web connections and consumer dissatisfaction, he argues.

“Today’s consumers expect their broadband connection to be fast and to work the first time, every time. They are less forgiving than they used to be, so evident gaps in quality of a service could well lead to customer churn for operators.”

As for whether Google is now quaking in its boots, figures released by comScore this week suggest the firm is still sitting pretty in Europe at least. The firm notes Google sites were the most-visited in the region during May, with visitor numbers up 9% year-on-year to 333.4 million, compared to Microsoft site’s 270.9 million and Facebook’s 240 million.

However, the tie-up between Microsoft-owned Skype and Microsoft-backed Facebook could certainly see the sites close the gap to Google.
 

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