The Luxembourg-based Net telephony company, founded by the people behind the Kazaa peer-to-peer service, is expected to announce on Monday that it has struck a partnership with consumer electronics chain RadioShack.
Since launching in 2002, Skype has rattled traditional telephone companies by offering free computer-to-computer VoIP calls and low-cost connectivity between computer and landline or mobile phones. While Skype can boast 66 million registered users and a growth rate of 180,000 new customers per day, the market is still in its infancy, and major conglomerates have begun venturing into the sector.
A tiny fraction of Americans use VoIP, and analysts have predicted that continued growth in the market may ignite a landgrab by large players.
On Wednesday, electronics kingpin Sony launched a free Web-based phone service designed to link users via their computer video cameras. Yahoo, America Online and others have long offered computer-to-computer phone services. Microsoft revealed plans earlier this month to offer Internet-to-telephone calling.
Skype's competitive position was bolstered in September when deep-pocketed eBay announced that it had agreed to acquire Skype for between $2.5 billion and $4 billion.
Besides growing competition, another obstacle Skype faces is entrenched consumer behavior, said Charles Golvin, a telecommunications analyst for Forrester Research.
"When consumers think of making phone calls, they look for their phone and not their PC," Golvin said. "I think moving into retail is a smart move by Skype. It removes one of the fundamental impediments to its business: It puts the necessary equipment into people's hands, and it helps to spread the word that free Web phone service exists."
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