[kennon]

I think you underestimate the importance of skype as a international means of communication, and overestimate the value most people place on privacy. When living abroad, it's the primary tool for keeping in touch with people back home or in other parts of the world. And why not? It's (mostly) free.

Even if skype came out and said they were recording every conversation, I don't know if all that many people would stop using it. There wasn't all that much outrage over immunity for the big telcos, for instance.

Or did you mean the company would be ruined for some other reason besides loss of reputation? Maybe I misunderstood the comment.

[brl]

Yes, I may be overestimating the reaction that people would have but it's not so much about privacy as abusing the trust of their users. I think most people would consider it pretty dishonest for Skype to place backdoors in their client application so that intelligence agencies can spy on their conversations.

It's more intentionally malicious to distribute software with a backdoor than to do what AT&T did so I really think it would upset people more.

Remember the Sony 'rootkit' fiasco? And that wasn't even really harmful, just annoying.