Skype is an interesting creature. Unlike other VVoIP applications like iChat AV, SightSpeed, MSN, AIM, etc., etc. this application uses peer to peer technology to make and place calls. Unlike many of the other VVoIP applications, Skype is one of the very few that seems to work without issue behind both a firewall and NAT, even at the corporate level.

With the exception of logon servers, Skype has no central server to maintain the network. Instead, Skype uses peer to peer technology to decentralize the network and to help ensure a very high uptime percentage. Once you log in to Skype, your system becomes part of the network itself helping to decentralize the load of routing phone calls. This also means that your computer will be used as a node so a bit of your bandwidth and CPU will be borrowed to help the rest of the Skype network, even if you're not in a phone call. I think of it as giving back to the community, but others may not like this so much. Although you're helping to relieve load, a good chunk of the Skype traffic goes through super nodes.

Super nodes are Skype nodes that are on huge pipes such as Universities and ISPs. When a supernode goes down the whole Skype network feels the pain but it won't take everything offline. That's the beauty of the Skype network, so long as a few nodes are still online, the network will self heal to a point. This all means that your call can be routed to any computer on the Skype network to reach its final destination. A computer you can't control. And that brings us to security. Skype uses a 256-bit encryption AES which is also used by U.S. Government Organizations to protect their own data. In other words, very secure.

So basically Skype is a giant peer to peer network with super good encryption that makes your phone system almost or just as reliable as your local Telco but without the ability for the government to listen in on your conversation. But instead of only being able to use voice you also get video, chat, SMS and presence awareness all in one application.

Of course those super nodes could end up being an issue some day, but until then in my opinion Skype has the highest call quality, best NAT/Firewall traversal and largest feature list. Oh, and the basics are free too! And that's why we covered Skype on Twin Cities Live today!

Want to add me to your Skype contact list? My username is benjaminhigginbotham Want a really in-depth technical analysis of how skype works? Check out this PDF which explains exactly how it all works.

Update: This is the segment that aired on Twin Cities Live