Skype Via Wal-Mart Misses Mark

Skype's decision to build its future on sales through mass merchant Wal-Mart is ill-advised and misses the mark. Consider that retailing of cell phones - a technology most consumers are much more familiar and comfortable with than Skype -is still tricky, and the wireless industry is still plagued with profund levels of overall customer dissatisfaction (latest JD Power scores show that top players in cellular industry continue to have satisfaction scores in the low-700s out of 1,000!).

Regardless of how optimistic VOIP (voice over internet) proponents want to be, the reality is that the technology is still seen as a more complex purchase for the average consumer. And opportunities to leave consumers unhappy after the sale are rampant (internet connection speeds; broadband usage fees; etc.) Some simple end-user basics that Skype might want to remember if they reconsider their distribution strategy:

• The phone is so intuitive to people...VoIP is a little more complicated
• Once consumers understand, and get comfortable ... VoIP will take off
• VoIP now tends to attract younger, tech-savvy consumers
• What they care about is feature-rich phones with Internet access, and it'd better be fast
• They also like ring tones, text messaging and downloading video and music

Wal-Mart has never done well with technology products, and typically stumbles with products and categories at the newer end of the spectrum. Yet, here is Skype's latest retail channel direction. Predictions anyone?

Wal-Mart shoppers can now add one more item to their carts: Skype's
Internet phones.Handsets, webcams and other gear from Skype, a pioneer in
PC-to-PC calling, will be sold in more than 1,800 Wal-Mart stores starting today. The Wal-Mart partnership is the latest sign that Skype has arrived on Main
Street, says Don Albert, vice president of Skype's North American
operations."This brings Internet communications to the masses," he says. "This
relationship is an acknowledgment that Skype has arrived in the
mainstream." (USA Today, May 14, 2007, MONEY; Pg. 5B).