Skype and similar teleconferencing tools are great. I use them regularly to keep in touch with family while travelling and occasionally to talk to collaborators. It is much better than the phone and way better than exchanging emails.
There are some techno-enthusiasts who claim we don't need to have conferences anymore because we can do it all on line and save lots of money. In companies there are those who push for tele-commuting and only have a central office with hot desks that people occasionally use. I have even heard of Australian universities who have hired faculty members from overseas solely based on a Skype interview!
I think such enthusiasm is a big mistake. I have been at a few conferences where some "big shot" did not attend but gave their talk via tele-conferencing. It really wasn't the same as having them in the room. Even without technical glitches, it was not very engaging. Once I was even at a social event where a couple "attended" via Skype. It was inane and awkward.
Recently I attended a committee meeting via Skype. This was the first time I had done that. On a basic level it was o.k., particularly because the subjects under discussion were not that weighty. However, I did notice how different it was to actually being in the room. In particular, I had no sense of body language, facial cues, or tone of voice. I could not really tell how what I said was being received or get much sense of the mood in the room. It was also harder just to engage with the meeting. I struggle with that sometimes, even when I am in the room!
I think when you know the other parties well and the subject is not controversial this is all fine. However, I think on any sensitive subjects or with people you don't really know for important meetings there is no substitute for a face-to-face meeting. People are intrinsically relational and emotional.