This was the point I was going to make too. Skype is terrible, but yet it is still the best compared the competition.
Let's consider the competition:
- Live Messenger: It was the next best, now discontinued, but before that it was poorly supported, rarely updated, and had a ton of bugs. No external connectors (e.g. telephone networks).
- Google Hangouts: Browser only. No external connectors.
- Facetime: Apple ecosystem only. No external connectors.
- AIM: No video/voice chat. No external connectors.
- Cisco WebEx: Expensive.
I'm sure there are others. But in general this is a very unhealthy market with not a lot of competition. It has always been that way. We desperately need an explosion of innovation here.
The problem with Google Hangouts is that it's fragmented. The GMail client does have external connectors, in fact they're still free for Canada/US calling. But calling another person for a hangout still requires they have Google+, IIRC.
Google has a chance to destroy Skype with GTalk and hangouts, but instead they're suffocating it by trying to bundle it with Google+. I don't mind signing up for Google+, but I've given up with using Hangouts with my parents because they don't want to sign up for a social network.
If/when WebRTC hits mainstream, it's conceivable that built-in video chat won't matter anyway. If I can generate a URL and send it to anybody with a browser and start a video conversation, I don't need a heavy client like skype any more.
Google Hangouts works with apps too, not just a computer browser. I've been using it with my work team for about a year since we're often spread across the country and it's been amazing. We tried Skype, but it often didn't load the video feed.
It doesn't have a dedicated PC or Mac application like Skype does. Which is a big downside. Trying to keep a chat session open in a browser window or tab all day is surprisingly annoying as it is too easy to close the window/tab without realizing what it is.
There was a Google application called like Google Talk but that never supported video as far as I know.
Skype is also the only reliable option for VOIP calling on Android, which is unfortunate since the Android Skype client is buggy and missing some obviously needed features. The alternatives (groove ip, sipdroid, csipsimple) are even flakier and/or require you to have an account with a reliable sip provider.
Let's consider the competition:
- Live Messenger: It was the next best, now discontinued, but before that it was poorly supported, rarely updated, and had a ton of bugs. No external connectors (e.g. telephone networks).
- Google Hangouts: Browser only. No external connectors.
- Facetime: Apple ecosystem only. No external connectors.
- AIM: No video/voice chat. No external connectors.
- Cisco WebEx: Expensive.
I'm sure there are others. But in general this is a very unhealthy market with not a lot of competition. It has always been that way. We desperately need an explosion of innovation here.