Skype’s Rosenberg discusses telecom revolution

Jonathan Rosenberg, chief technologist for Skype, says the transformational changes in telecommunications have only just begun.


“We are in the middle of an incredible revolution of how technology works as a whole. Voice Over IP has already transformed communication, and we have just begun,” said Jonathan Rosenberg, chief technologist for Skype, during an April 16 lecture at Elon University titled “The Invisible Revolution: Remaking Telecoms in the Image of the Internet.”

Rosenberg is responsible for the overall architecture and technology strategy at Skype Technologies S.A., which is now a division of Microsoft. He was awarded the Pulver VoN Pioneer award in 2000 for his contributions to the Voice over Internet Protocol (VoIP) industry.

“The revolution is about a change that has been happening in our industry of telecommunications,” Rosenberg said, “a change that has brought an enormous transformation to our industry. This change is what I call the Invisible Revolution. It will be a transformation that is continuing for the next 10 years.”

Skype now is responsible for 25 percent of all international calls from any platform, and about 12 percent of international calls via Skype now include video, Rosenberg said.

“Holy cow, this is a market that didn’t exist, and now 12.5 percent of international calls include video,” Rosenberg said. “This technology just didn’t even exist.”

The history of telecommunications

This increase in video international calls is especially remarkable when compared to the history of telecommunications, Rosenberg said.

Changing the phone network from analog to digital took decades. And even today, relics of telecommunications can be still be found in people’s homes—in their land line phones.

In the 1990s when the Internet came along it changed telecommunications. The differences between the Internet and telecommunications have caused some challenges.

“This is a dramatically different technology from how the telecommunications network works,” Rosenberg said. “The phone quality was built from the ground up to guarantee that quality call. The Internet does not make that guarantee. The Internet drops information all the time. The Internet is what we call a best effort quality.”

If someone is trying to talk from New York to Florida, we have to make the sure the information flows basically in a straight line to Florida.

“The problem is that these things are really expensive. The Internet does things differently,” Rosenberg said. “The Internet doesn’t know how to set up a call, just how to ship information from point A to point B.”

A solution was found for this problem around the idea to dramatically reduce the price by going from expensive hardware to cheap software. The software is on a server, and then the computers are connected directly to each other for the audio, to make the quality of the phone calls better and cheaper.

The quality of the audio is the most important factor when it comes to calls over the phone or the Internet, Rosenberg said.

While the telecommunications network was designed to carry phone calls well, there are two fundamental flaws that have made it difficult: human brains are sensitive to a delay in conversation and quality really matters.

“Users have to really mentally struggle to listen when the quality is bad, it causes fatigue, and they would rather hang up or get on a plane and have a face to face conversation,” Rosenberg said. “Users have an expectation, a need, for high quality communications.”

The changing business atmosphere

With the transformation to IP and Voice Over IP, companies such as Cisco and Microsoft, companies that didn’t exist in the telecommunications field, were able to get a hold on the industry.

Other companies that grew due to Voice Over IP were application service providers such as Skype.

Skype was founded in 2003 by a couple of guys and by 2011 was sold for $8.5 billion. Today there are 40 million users online now at any given time and 200 million connected users per month, Rosenberg said.

“There has been these dramatic transformations across the industry as a result of VoIP,” Rosenberg said. “But the biggest transformation came with the iPhone. Apple has literally revolutionized the mobile telecommunications ecosystem with the creation of the iPhone.”

This led to a second fundamental change in the ability to distribute software to the mobile phone, Rosenberg said. With the app store, software can very easily be distributed to mobile phones. The third fundamental change has been the importance of the brand. The user’s relationship is with the brand, not the mobile operator.

This benefited application service providers such as Skype because it finally made the smart phone a viable place for voice over IP to happen.

Rosenberg also held a question and answer session with students enrolled in upper level journalism classes earlier in the day. He discussed the Skype business model compared to competitors and the recent transformations in technology.

“Skype is a personal product that allows people to connect with their family and friends,” Rosenberg said. “People care about it, and it is great to see how Voice Over IP has been able to change people’s lives.”

Rosenberg received his bachelor’s and master’s degrees from the Massachusetts Institute of Technology, where he was inducted into Phi Beta Kappa. He earned his doctorate in philosophy from Columbia University and lives in Freehold, N.J., with his wife and two children.

His lecture was sponsored by Elon’s Eta Chapter of Phi Beta Kappa.

— by Rebecca Smith, ‘12


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