A report from analyst firm the Burton Group has warned enterprises of the security dangers in using Skype.

The report, entitled Debunking the Hype About Skype, warns that, while the VoIP application might offer lower communication costs, the resulting security holes could endanger the company.

"If the risk is too high, ban Skype," stated the report's author, senior analyst Irwin Lazar. "If the reward outweighs the risk, consider Skype as part of an overall communications strategy."

Lazar explained that Skype is proprietary software that allows unrecordable conversations with those outside the enterprise, and may represent a serious security risk.

The analyst also noted that the success of Skype has led to a slew of competing services, both from traditional instant messaging providers such as AOL, Yahoo and MSN, as well as start-ups such as Tello and Gizmo.

Lazar expects the market for integrated communications services to continue to grow rapidly.

"The report from Burton Group confused me," said Tom Newton, product development manager at internet security provider SmoothWall.

"I appreciate that Skype offers numerous benefits such as cost savings, but weighing these up against corporate security is suicide.

"Just imagine trying to argue to a chief executive that the reason critical corporate data was lost was because the company was trying to save costs on phone bills. I would not want to be you."