Thinking about Skype for your home network? Do you know the security risks involved?

We’ve talked about Skype several times before now, and we’ve generally had some great things to say. Skype can be a very efficient way to make phone-calls, IM, and transfer data even over international distances, and it works a little differently than some other VoIP clients. As a recent podcast at BlueBox suggests, the pros and cons of Skype are legion (although that podcast does a pretty good job of breaking them down). Still, we think that a simple look at security is the best place to start when considering Skype for your home network.
Take my Skype. Please.

Skype is sort of a conundrum because it is sort of a benchmark for VoIP functionality even though it’s not exactly “regular” VoIP. Instead, it actually works on P2P structure, relying on lots of connected nodes to each transfer a part of the information. That’s potentially better for bandwidth, but it’s also a big potential risk. Part of the reason for that risk is the fact that P2P can’t connect through a Network Address Translation (NAT) firewall, which is common to many network structures. To bypass that, Skype is designed to sneak around firewalls with all the stealth of a well-dressed ninja. However, Skype expert Michael Gough argues that the firewall-work-around isn’t necessarily that big a risk:

“Skype… encrypts each communication with a unique AES 25-bit encryption key, meaning each communication will use a different key each time you communicate, making eavesdropping communications almost impossible.” (from his ComputerWorld article)

He also points out that Skype’s use of Supernodes (referring here to a computer without a NAT connection to the internet) means that Skype connections should be able to stay connected without circumnavigating and potentially compromising firewalls. Finally, he argues against five common misconceptions about Skype including its high-bandwidth, user-difficulty in blocking it, and its susceptibility to IM worms and viruses.

We’ve talked a little before about how not everyone wants you to use VoIP. It’s relatively cheap, continually improving technology is making for better call quality, and it places even international calls in easy (and cheap) reach. So why aren’t VoIP phones as ubiquitous as the cell phones every single person on the street has attached to their heads? Well, that day is fast approaching, because the newest, most widely used communication technology out there could be a combination of two existing ones: cell phones and VoIP.

Sooooo much fighting…

Part of the problem with widespread VoIP deployment has been that land-line and cell providers don’t like competition, and they have lots of high-powered friends. Every time a VoIP provider comes out with a new product or service, somebody drags them into Federal court. A handful of monstrous lawsuits in 2006 did a lot to hinder VoIP. Skype (owned by eBay) got sued (in one of several suits filed against them) for $4.1 billion. Vonage, who has recently begun a pretty aggressive-but-charming ad campaign, had an especially rough go of it when Verizon sued them for all sorts of patent infringements. However, VoIP technology (if not necessarily individual VoIP firms) has proven pretty resilient, and all this bickering might just be a thing of the past.

Now, you guys shake and make nice

As “traditional” telecommunications companies feel pressure from VoIP, they’ve brought prices lower and lower. AT&T, for instance, just announced that users of their CallVantage Softphone Service (their version of VoIP, actually) will get drastic discounts on international calls. Still, lots of people are predicting even bigger concessions over the next several years as VoIP’s pressure continues to build. Juniper Research, a major telecom, and media research firm, is predicting that the market for Wi-Fi VoIP should reach $70 billion by 2012 (according to a post at PC World).
However, they predict that roughly two percent or less of the devices in that market will be just VoIP phones. Instead, most of the phones out there are going to be combination cell/VoIP phones (also being called “dual-mode handsets”). That could be great news for consumers, but it might put existing VoIP providers at something of a disadvantage. Cell phone companies already have towers, stores, infrastructure, etc. in place to work on implementing VoIP. VoIP firms, on the other hand, have the Internet. What’ll probably play a big role is whether or not existing telecoms want to spend money developing VoIP (and some – like AT&T – have already begun to) or whether they decide it would be cheaper/easier to just partner with existing VoIP providers. Either way, it’s likely that VoIP technology is going to be something we all use whether we realize it or not.

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