Skype gets into bed with Facebook

VOICE OVER IP (VoIP), chat and video conferencing outfit Skype has been talking up its future with the social networking web site Facebook.

Skype’s recent acquisition by Microsoft puts it in the box seats to work with Facebook, allowing both firms to push VoIP services to Facebook’s social network. Microsoft, which was an early investor in Facebook, doesn’t view the social network as a threat and has worked with it in the past, especially with its search engine Bing.

However Facebook could be a big help to Microsoft as it tries to claw back some of the $8.5bn it forked over for a company that turns over a negligible profit. Forbes reports that not only will Skype appear on Microsoft’s Windows Phone 7 operating system but that Skype VP Neil Stevens wants Skype to be a service, not an application.

In order to make that dream come true ever tighter integration with other applications, and in particular Facebook, is on the agenda. As The INQUIRER reported last year, a VoIP service is the logical next step for Facebook, which needs to enrich its ‘social graph’ with more real time data. Having Skype provide a service to do just that will be beneficial for all concerned, except perhaps with regard to the privacy of Facebook users.

Stevens told Forbes that Skype’s agreement with Facebook is not a “one-time, one-product” deal, adding, “We have a plan to build out a number of products with Facebook… we’ll be Facebook’s key partner for communications.”

Facebook recently launched a video chat service that uses Skype, and Stevens said that most of the bugs have been ironed out and it will be rolled out to more users over the next few weeks. After it has rolled out that service Facebook will start to offer outbound calling to phones, requiring users to pay with Skype credits, though it is expected that Facebook will get a cut of charges for all call minutes from its users too.

Due to the popularity of Facebook, this might be the only chance Skype and its new parent, Microsoft, have of making money. History has shown that even though Skype is immensely popular, as a standalone application its revenue generation possibilities are relatively limited. Perhaps tagging onto Facebook’s popularity will help Microsoft turn its fortunes around. µ

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Facebook’s Mark Zuckerberg, Barefoot With Beer: 2005 Interview Reveals CEO’s …

“Should I put the beer down?” Mark Zuckerberg asks.

The CEO and co-founder of Facebook, now the world’s largest social networking site, sits on a velour couch in the company’s Palo Alto offices. He is barefoot, dressed in Adidas shorts and a white cotton T-shirt. Movie posters for “Scarface” and “Pulp Fiction” hang on the walls behind him, and an unplugged lava lamp stands to his right.

It’s June 2005 and the 15 month-old social networking site is celebrating its three-millionth user with a keg of Heineken. Zuckerberg’s co-founder does a keg stand with help from his co-workers, who prop him up on the keg, legs in the air, so he can drink directly from the tap.

Facebook, at this point, has spread to more than 800 schools, is open only to college students and has just twenty employees, including “someone who orders our kegs,” Zuckerberg jokes.

This glimpse of Facebook’s early days is afforded by a 40-minute interview with Zuckerberg, never aired in full, filmed by Ray Hafner and Derek Franzese for their documentary about the millennial generation, “Now Entering,” released in 2008. Franzese posted a five-minute excerpt of the conversation on YouTube and provided The Huffington Post with access to footage of the entire interview. Facebook spokesman Larry Yu declined to comment on the video.

The portrait that emerges from the video is of a young man either still unclear about the possibilities that lie ahead for the explosively-growing company, or playing it coy, hewing to an image as an almost accidental entrepreneur, merely having fun amid college-age antics. He dismisses the suggestion that his business could be poised to become a global behemoth, though that is precisely what is about to happen.

In the end, the interview tees up a tantalizing question, while pulling the answer further from view: How much of Facebook’s stratospheric rise was by design, and how much by happenstance? How much randomness helps explain which ventures never transcend the metaphorical garage and which emerge to capture public fascination?

Zuckerberg comes off as modest, questioning and openly unsure about what lies ahead for Facebook. There is no hint that he sees himself capable of changing the world or making a fortune through his creation, though he has since done both. He seems slightly clueless as to the potential growth of his company. This changed quickly, however — a year later, Yahoo would offer $1 billion for Facebook, which Zuckerberg refused.

“I still don’t know if we have something,” Zuckerberg says of Facebook in the interview. “Whether we have something that will last for a really long time or is just a cool toy for people to play with now, we’ll see. I think it’s actually useful and not necessarily just a fad.”

Zuckerberg outlines what now appear to be modest goals for the site, expressing doubt that it would grow beyond college students. In 2011, when Facebook has more than 750 million members, offices in 15 countries and a valuation well over $50 billion, the idea seems nothing short of absurd.

Asked what he will do after Facebook expands to campuses it had yet to conquer, Zuckerberg counters, “There doesn’t necessarily have to be more.”

“A lot of people are focused on taking over the world or doing the biggest thing and getting the most users,” he continues. “I think part of making a difference and doing something cool is focusing intensely. There’s a level of service that we could provide when we’re just at Harvard that we can’t provide for all of the colleges, and there’s a level of service that we can provide when we’re a college network that we wouldn’t be able to provide if we went to other types of things.”

The persona projected by Zuckerberg contrasts sharply with that of two other Silicon Valley legends who built their own Web behemoth: Larry Page and Sergey Brin, the co-founders of Google.

The duo, who were only a few years older than Zuckerberg when they founded the search engine, became notorious for their ambitious goals, confidence and audacious visions. While investors predicted the company had a shot at being worth $1 billion some day, Page and Brin promised it would eventually reap $10 billion a year. They made it their mission to build a search engine “as smart as you” that would “organize the world’s information and make it universally accessible and useful.”

Zuckerberg offers measured enthusiasm for his project and downplays its significance without any clear indication of false modesty. Sean Parker, who worked closely with Zuckerberg during Facebook’s first few years, recalls in “The Facebook Effect” that Zuckerberg was, at this point, “very rational about the low probability of building a true empire” and would question whether his project “would last.”

“I thought it was really cool for awhile, but I don’t know, I mean, other people are doing interesting things too,” Zuckerberg says in the interview. “I’m happy with what I’m doing but I don’t really think it’s that much cooler than what everyone else is doing. College is really fun and all my friends back at school are having a really good time, too.”

The twenty-something even admits to having mixed feelings about his company’s growth, which he says has brought with it unwanted attention, the need to manage larger teams and a slower pace of development.

“Working with a lot of people at the same time is a task. I really like making stuff and getting stuff done,” Zuckerberg says. “One of the things I really liked about Facebook was that I could always move so quickly. I wrote the original application in like nine days at the end of January. Now with 20 people we have this whole organization … We’re a little less agile now.”

Though he famously printed business cards to read “I’m CEO…bitch,” Zuckerberg suggests in the interview that he is open to alternate roles and concedes he might consider hiring someone to be chief executive so he could “focus more on cool ideas,” which he says is “more fun.” He expresses concern that the CEO of a larger company is “really just managing,” but “not necessarily being the guy with big ideas.”

David Kirkpatrick, author of “The Facebook Effect,” notes that in the summer of 2005, Zuckerberg was still feeling out Facebook and transitioning away from another project, the file-sharing service Wirehog, which he said Zuckerberg had found more challenging than the social network and incorporated as a company.

“He was still in the process of completely committing to Facebook,” Kirkpatrick told The Huffington Post. “He felt quite strongly that what he would do with his life was come up with lots of cool ideas and inventions and launch them, then get other people to run them for him. He viewed himself more as an inventor than a manager.”

So how did Zuckerberg go from “I still don’t know if we have something” to turning down a billion-dollar offer? What clicked — and when — to convince him that Facebook was not a fad but a “utility,” as he would describe it just a few months later?

The company’s explosive growth in the fall of 2005, when it added another two million members, helped cement its status in Silicon Valley and among students, clues that Zuckerberg was on to something big. Just a few months after the filmmakers’ interview, the company was earning $1 million each month, could boast 230 million page views per day and was visited daily by 70 percent of its users, according to “The Facebook Effect.” High-level executives from News Corp., Microsoft, Yahoo and Viacom began to court Zuckerberg.

“Time goes slower when you’re young, and in a year, Facebook did change dramatically as a business,” Kirkpatrick said. “Zuckerberg was capable of changing his approach to it with great rapidity, which is something he continues to do to this day.”

Throughout the interview, there are numerous reminders that Zuckerberg is still barely out of his teens. In addition to chatting about campus parties and the ways his new responsibilities have taken a toll on some friendships, he likens the company’s decision to accept funding to picking up girls.

“We actually got that money because we didn’t need it,” he explains. “It’s kind of like where you’re probably more likely to hook up with a girl if you go into a party not wanting to hook up with a girl.”

Zuckerberg ultimately comes off as camera-shy and committed to coding, more interested in his work than in questions about it.

“I like making things,” he says. “I don’t like getting my picture taken.”

Additional reporting by Cooper Smith.

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