What's with the hype around Skype?

I was just chatting with a buddy who introduced me to Skype a while back (but I never got around to using it) when he reminded me of it again. (For those of you who don't know, it's a P2P program that lets you make phone/voice calls over the internet - pls note internet is now or soon to be internet as per orangefever.net, not Internet!) The last time I checked, Skype's site was ugly looking with a very basic red and white page. Now, it's like totally revamped and looks legit... Anyway, I'm gonna try it tomorrow on my real machine when I get back, but right now, I'm wondering what's up with Skype. Even the chairman of FCC gave a review on it... Everybody says its quality is very good, yet it's free (for Skype to Skype calls)... And Skype to phone calls are apparently very competitive according to my buddy, but how're they making money? The fact that they're made by ppl who brought us Kazaa might give us a clue, but it promised no spyware, adware nor malware on their site! Anyway, its like freaking 4am and I don't feel like doing much digging at this hour... But if any of you know, I'd like to know too! (There doesn't seem to be ads in their screenshots... but I guess I'll know when I install it tomorrow)

But another even more fascinating thing I found, which perhaps all of you know, is that you can use earphones as microphones! I mean, the mechanics/physics behind it is so simple, yet it never occurred to me that it's possible to just use an earbud as a microphone! This is geeky, but wth, I'm looking forward to trying it out tomorrow! (BTW, my friend just tried powered and nonpowered speakers/earphones, and he said it only worked on nonpowered ones for him.) Never will I have to buy a microphone again, I'll just use my headset, as I've got a couple floating around anyway....

Oh yeah, thanks for calling me up, ha ha, it was a pleasant surprise! Hrmmm, if you install Skype, then perhaps next time you can call me via that and we can talk about Naruto online!