Google Takes on Skype with Phone Service via Gmail

Posted Aug 26th 2010 11:30AM by Connie Madon
Filed under: Competitive Strategy, Google (GOOG), eBay (EBAY)

Gmail logo Google (GOOG) has a new service, as reported in Reuters. Starting now, you can make free calls in the U.S. and Canada from you Gmail account. Calls to other countries will be as cheap as two cents per minute. Google's stock was up $3.22 Wednesday to $454.62.

The process is real simple. Just click on the "call line" option on the chat buddy list in Gmail and type in the number. You can also enter a contact person.

Long-distance calls will be charged via an online account with a credit card.

The service will not be available for outgoing calls on cell phones because Google already has that service.

Google's obvious competitor is Skype, which is owned by eBay (EBAY). For years Skype has had a service of free computer-to-phone calls. Google's service will be in direct competition with Skype. The one advantage that Google has is brand name.

Which service would you use, Gmail or Skype?

Tags: eBay, Gmail, GOOG, inthenews, Skype