Skype - technical definition

An Internet telephone and videophone service from Skype Limited, Luxembourg (www.skype.com). Being software based, calls from Skype subscribers originate from their computers, and all computer-to-computer calls between subscribers are free, including video. Access to regular telephones is also available. With "SkypeOut," users dial a regular telephone for a low per-minute charge. "SkypeIn" lets people worldwide call a Skype subscriber from a regular telephone by dialing a local Skype phone number. See softphone.

Explosive Growth
Introduced in July 2004, within a year, more than a hundred million people downloaded the software. In the fall of 2005, Skype claimed 40 million active users and was acquired by eBay for $2.6 billion. By late 2008, an average of 10 million users were using Skype simultaneously.

Supernodes
Rather than using standard voice over IP (VoIP) protocols such as SIP and H.323, Skype uses proprietary protocols that incorporate a peer-to-peer architecture. If Skype cannot make a direct connection from one user to the other, it may elicit one of its users who has the Skype application loaded to become a "supernode" and relay the call. Only a fraction of the millions of Skype users become supernodes at any given time. See supernode.

Portable Skype Phones
Similar to a cordless phone, a Skype telephone is portable and frees subscribers from being tethered to their PCs. It transmits wireless to a base station that plugs into the PC via USB or into a free port on a network router. In addition, there are adapters that let existing desk and portable phones make regular phone calls and Skype calls. The user's phone plugs into the adapter, which plugs into both the PC and the telephone jack on the wall.