Skype problems may continue throughout the day

Skype Ltd. is still trying to restore service to millions of its customers almost 24 hours after they began to experience problems logging in to the VOIP service.

The problems are likely to continue throughout the day, Skype warned in a status announcement at 11 a.m. GMT Friday.

The company first acknowledged the service outage around 2 p.m. Thursday, and later identified the cause as "a deficiency in an algorithm within Skype networking software." It ruled out any link with the planned maintenance of its Web-based payment service on Wednesday, and said it had not been the victim of a cyber attack.

The service had been sporadic but gradually improving during the business day in Asia on Friday. The number of users that can now sign in is "encouraging," Skype said.

But one analyst who managed to connect to the service intermittently noted that the number of users online is far below usual levels.

"There are about 2.5 million people logged in right now, where normally there would be over 8 million, and it's been going on and off every 10 minutes," said Mark Main, senior analyst at Ovum in London.

Up to a third of the affected Skype users could be in small businesses, Main estimates.

The outage is particularly frustrating for them because "Skype has no customer response team," he said.

Skype will have to work hard not to lose the trust of such customers, he added: "They did say 12-24 hours. Their 24 hours is nearly up."

This could be an opening for other VOIP operators to step in and pick up some new business, he said.