Los Angeles — Popular Internet communications service Skype, on Monday unveiled plans to roll out ads in its Windows-based desktop client in the U.S., Germany and the U.K. this week in a bid to develop a new revenue stream ahead of the company’s anticipated public offering.
According to the official company blog post this morning, the VoIP calling service will feature ads in the Home tab area of its Windows-based software. Customers can expect one ad per day, currently companies like Groupon, Universal Pictures, and Visa, writes Doug Bewsher, Skype’s chief marketing officer.
Skype, which evades the standard telephone network by channeling voice, video and text conversations over the Web, said the ads will appear only in Britain, Germany and the United States for now. The introduction of advertising is Skype’s latest bid to increase revenue ahead of an initial public offering expected later this year.
The ads will be based on “non-personally identifiable demographic data (e.g. location, gender and age),” Bewsher writes, adding that customers can request that Skype withhold this information from advertisers. “The ads would not interrupt your Skype experience,” says Bewsher. “You would not suddenly see annoying pop-up ads or flashy banner ads in middle of conversations.”
Skype’s IPO could be one of the humongous in the technology sector since Google Inc. raised $1.67 billion in 2004, but while hundreds of millions of people around the world use Skype, some investors remain concerned about its ability to profit from its huge user base.
The Luxembourg-based Skype, which was established in 2003, announced plans in August to raise up to 100 million dollars by listing on the Nasdaq stock exchange. The company boasts an average of 145 million monthly connected users at the end of 2010, but only 8.8 million monthly paying users, according to Skype’s recently filed amended S-1. Last year, it generated $860 million of net revenues and had a net loss of about $7 million.
“The Skype experience is our first priority, which is why we have consumed a lot of time working through and testing what kind of advertising would work best in the Skype environment,” Skype said in a blog post.
“We believe that advertising, when done in the right way, will help us continue to invest in developing great products,” the company said.
According to its IPO registration statement, Skype generated $406 million in revenue in the first half of 2010 and had 560 million registered users.
However, the update is not a surprising one, as most of Skype’s users hold free accounts, it is a logical move for the company to make ads a prominent part of the user interface. “We think this is an interesting opportunity for advertisers,” Bewsher, said in a statement. “This is a premium placement to engage with our users.”
But Skype’s competition is getting exorbitant, with a rising number of inclusive chat tools integrating with social media networks, professional services and mobile devices.
Hence, the inclusion of display advertising is the latest in a string of updates Skype has pushed forward these last few months, moving the company in the direction of an ad network.