Every time I reinstall Skype on Linux I lose sound for some reason. I can hear the other side, but they can’t hear me. I fiddle with the volume settings, and after a while it starts working. This time, I paid attention and made note of how I got it working. This post is as much for me as for anyone else on Ubuntu. 
Firstly, under Options > Sound Devices I switched the output device to pulse. Then I set the input device to “HDA Intel (hw:Intel,0)”. Then I opened the volume control, enabled all the devices, and set Mic Boost to about 15%. That was the critical step. Now callers can hear me.
For the first time in my Linux history, I can now receive a Skype call and have music playing at the same time. Previously, I had to kill all other sound output before answering the call and I would only see it ring, not hear it. Much progress.
Here’s a random picture from a search for Skype on flickr to brighten things up a little.
Hi. I wanted to thank you for the Skype tip. Now, everything is flawless. Keep up the excellent work! Ubuntu 8.10 rocks!
It’s probably hogging the audio device. By telling it to use pulseaudio, you’re making it play nice with everything else – pulseaudio is like a proxy for the sound device that enables sharing.
@mc: Yes indeed. I hadn’t noticed pulse listed in the devices before. Not sure if it’s a new thing or I just hadn’t spotted it.
Actually it’s a new thing:) it was implemented since ubuntu 8.04 but it’s intrepid ibex who makes a full use of it:)
Thanks a lot mate, you are my hero:)
Greetings, and thank you for that! Worked very well for us.