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Truphone, a mobile VoIP service provider based in Kent, U.K., is planning to announce more Symbian handsets that can run its VoWLAN software, including newer S60 and UIQ devices, at the upcoming 3GSM show in Barcelona, Spain.
The company plans to support up to 25 handsets by the end of 2007, including Windows Mobile-based smart phones, TruPhone Chief Executive James Tagg said in an interview. Along with the added handsets, the company announced today that it has added interoperability with Google Talk (GigaTeam is happy about the news as we spend a lot of time using the Google service).
Truphone is one of a growing number of companies that are looking to bring low-cost VoIP calling to phones with either Wi-Fi or 3G capabilities. This group of start-ups has been receiving liberal doses of funding from the venture capital community. Truphone recently got £12.5 million ($24.5 million) in Series A funding from Wellington Partners, Independent News & Media, Burda Digital Ventures and existing investors.
The company works out of a converted barn in Kent, has 25 employees and is now working on putting more value-added features into its client. “We want to use cheap voice minutes to attract customers and then offer more services on top of that,” says Tagg. Truphone plans to soon offer services such as SMS-over-IP, video over IP and location-based applications. “We are also looking at gaming over IP via Wi-Fi,” says Tagg. Many of these features could be available by the middle of 2007.
“This year 60% of our revenues will come from voice, and by next year (2008) we hope to bring that down to 40%,” Tagg told us. He thinks it is part of a larger industry trend. He predicts that in 10 years the bulk of a carrier’s revenues will come from non-voice services. But that’s in a decade – for now voice is where the money is!
Tagg admits that cheap voice is not as much a lure in the U.S., but in Europe and the rest of the world where per-call rates are pretty high, it can be quite an enticement for customers. “Out-of- network calls in the U.K. can cost you 25 cents a minute, so if you can bring it down, you are an attractive proposition for consumers,” says Tagg.
Wi-Fi-based voice is a good option, he argues, because it is cheap enough and allows people to talk a lot. “People like to talk a lot when it is cheap enough,” he says. In other words, the voice hills might look barren, but there are still spigots of gold if you look hard enough.
But problems with this model could arise if Truphone has success to the point where people can make Truphone-to-Truphone calls for free — a dash of investment irrationality we’ve talked about before. Still, the company has a long way to go before it can turn into a major force – it has just a few thousand customers at present.
The good news is that an increasing number of mobile phones will have Wi-Fi built in. Broadcom and Texas Instruments have recently introduced Wi-Fi chips that are optimized for mobile handsets that are more powerful and consume less battery power – a constant complaint with the dual mode handsets. ABI Research is particularly bullish, seeing shipments of more than 300 million dual-mode cellular/Wi-Fi phones by 2011.
When asked if he is going to offer Truphone over 3G, Tagg replied that it is something the company has considered. “We are not offering it at present because there is a lot of confusion about the 3G data tariffs, and we don’t want our customers getting stuck with big bills,” says Tagg. The Bill Shock, he says can prove to be counter-productive for Truphone.
The company also added interoperability for Google Talk today. Essentially Truphone users show up as “contacts” on Google Talk and one can converse with each other for free.
‘On-net’ Truphone users show as ‘online’ in Google Talk, enabling people to know exactly when they can make a free call. Calls between Google Talk and Truphone are free because they are pure VoIP calls and take place entirely over the internet. Communication between Google’s servers and Truphone’s servers is via the standard XMPP protocol. (From Press Release)
Increasingly, it seems that the race is between Gizmo and Truphone for mobile VoIP mindshare. When we asked Tagg about his competitors like Gizmo Project, he retorted that they are good competitors and they are all going after the incumbents. “Vodafone has 200 million customers, and instead of competing with each other, we will be competing with them,” he says.
Tagg is pretty hopeful about his company’s prospects going forward, especially with the increasing number of smart phones shipping to the market. With smart phones growing rapidly — up to almost 35 million over the past year, a growth rate of 75 percent, according to Gartner — Truphone could get a little more traction as more handsets can handle the new applications.
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Written by Om Malik on February 8th, 2007 with no comments.
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Guess who got stuck with a big bill for all those “free” international calls touted by outfits like FuturePhone? None other than AT&T, which has filed a lawsuit in Iowa claiming that “deceitful and unlawful schemes” like FuturePhone’s caused a jump from $2,000 per month to $2 million per month in the fees billed AT&T by an Iowa rural telco.
Filed in the U.S. District Court for the Southern District of Iowa, Central Division, AT&T’s lawsuit seeks to stop FuturePhone as well as the telcos who provide local infrastructure from continuing with their operations that use regulatory-fee arbitrage and VoIP to provide international calls for only the price of a long-distance call to Iowa. Though the case was just filed on Jan. 29, it has already apparently caused FuturePhone to shutter its service, and has produced nothing but “no comment” replies from the Iowa LECs we contacted who were also named in the suit.
“This is just the latest in a long line of get-rich-quick schemes that bilk others to make a profit,” said an AT&T spokesperson. The lawsuit claims that operations like FuturePhone’s are in violation of several statutes, including Iowa state laws as well as previous FCC decisions.
Some background, for those not familiar with how intricate cross-network billing can get: When a long-distance call is “terminated,” if a long-distance provider like AT&T doesn’t own the local lines where that call is going to, it must pay a fee to the company that does. Even though such termination fees are typically higher in rural areas, since there are usually relatively few customers in the sticks big long-distance providers can easily balance the cost with their other businesses.
In Iowa, higher than average termination fees (as much as 13 cents per minute, according to AT&T) have been lately combined with fiber-based Internet access to provide a pretty good place for a VoIP-based gateway, which can then provide a way to cheaply reach foreign PSTNs. The loophole comes from some method of subtracting the money paid for foreign terminations from the amount gained by terminating calls in Iowa. While the margins are pennies-or-less per call, the lure of avoiding the high cost of international calls apparently caught on quickly, to the tune of hundreds of thousands of minutes a month, according to AT&T.
And when AT&T’s average monthly bill to one such Iowa telco, the Superior Telephone Cooperative, went from $2,000 to $2,000,000, it was time for Ma Bell to call the fine-suited folks at Sidley Austin LLP to try to close the loophole down.
Boiled down, AT&T’s main argument is that because the calls are not actually “terminated” in Iowa — AT&T says Iowa is just a midpoint in what is really an international call — AT&T shouldn’t have to pay the LECs the termination fees. Telco legal sources we talked to said that while the suit’s merit can certainly be contested, what it does immediately is give AT&T a legal reason to stall payments of such monthly bills, which could effectively strong-arm the startups out of business.
In FuturePhone’s case it seemed to have done the trick, since FuturePhone’s website still carries a big red “this service is discontinued” banner, and contact numbers for the company have all apparently been disconnected. The person who answered the phone at Superior Coop referred us to another Iowa LEC, Great Lakes Communications, which was also named in AT&T’s suit. There, we talked by phone to someone who would only identify himself as “Josh,” who said when asked about FuturePhone, “I’m not going to tell you that stuff.”
While some free-call operations (including Free Call Planet, also named in AT&T’s suit) still seem to be operating in Iowa, AT&T did leave room for yet-unnamed firms at both the website and telco level to be added to the suit. The bottom line, for firms seeking to make a buck by using regulatory loopholes: Good luck in court, because the legal equivalent of the Yankees just showed up in Mudville.
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Written by Paul Kapustka on February 8th, 2007 with no comments.
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Fonality said that it has taken in $7 million in funding, led by Intel Capital which will be used to expand Fonality's operations in the U.S. and internationally.
Fonality sells ...
Written by News.blog: VoIP (CNET News.com) on February 7th, 2007 with no comments.
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Update #2: The service is live now
Update: The service is still not publicly available and is protected right now. Don’t try your Gizmo username or password - this is a seperate combo, which only company officials are privy to. More updates to follow.
SIPphone, the company behind Gizmo Project has introduced a new product, Gizmo Call that make is fairly simple to make VoIP calls from any browser that can support Adobe’s Flash.
You can visit Gizmocall.com, and you are prompted to download a small plugin, which is available for both Windows and Mac computers. We had reported on this development back in December 2006.
From a usability standpoint, this one gets a big thumbs up from me. After installing this tiny plugin, you are given a screen that is pretty much a Flash-based replica of the Gizmo Project soft client. (More on Flash & VoIP.)
The client auto configures your system, and uses the built in audio and video hardware of a computer to make phones calls. It easily found my Plantronics bluetooth headset, and used the MacBook Pro’s internal video camera for video calling.
You can call anyone who has either a Google Talk client or a Gizmo ID. Of course you can connect to PSTN numbers as well, by typing in the number you wish to connect to. Gizmo has also created a little embeddeable link which you can copy and paste in your blog, or on your MySpace page. People can call you by clicking on that button. You can embed the link in your emails as well. Its like SkypeMe, except you don’t need to launch a new application, but instead you use the web browser.
By launching this new browser based calling service, SIPphone is ensuring that it is staying current with newer rivals such as Jajah, Jaxtr, Wengo (Disclosure: Wengo is an advertiser on GigaOM Network) who are using widgets to popularize their services.
With no desktop client software to download, Gizmo & SIPphone are betting that there will be further interest in their low cost phone service. While my mother is grateful for these low cost services, I still remain skeptical of a business model that is reliant on low price as a business tool.
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Written by Om Malik on January 29th, 2007 with no comments.
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Avaya’s bid to acquire SIP application vendor Ubiquity was a tip-off that Voice over IP is becoming the center of importance at the enterprise telephony provider. Tuesday during Avaya’s earnings call the company confirmed that focus, announcing that it had sold more than 1 million IP phone lines for the third straight fiscal quarter, showing that corporate adoption of VoIP shows no signs of slowing.
While Avaya’s overall results seemed in line with analyst expectations, the IP numbers are increasing lines in the sand pointing toward an overall move from TDM to IP in the corporate communications arena. Avaya also said that investments like the Ubiquity buy will help it increase the integration of communications and business applications, a direction Avaya said it will look to for growth beyond its traditional telecom-supply businesses.
During the conference call Tuesday, Avaya gave an example of some early work in this direction, claiming it had helped a manufacturing company build direct communications functionality into a supply-chain application, that allowed the application to communicate levels of inventory and trigger replenishing actions. By “communications-enabling” such core business apps, Avaya is seeking to differentiate itself in the telecom business while seeking bigger margins and more overall growth.
“We’re embedding communications into the fabric of our customers’ core business,” said Avaya president and CEO Lou D’Ambrosio, who added that Ubiquity is “an important element as we extend that functionality in a SIP environment.” Expect to hear more IP telephony news when Cisco announces its financials Feb. 6.
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Written by Paul Kapustka on January 24th, 2007 with no comments.
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Just a quick update on the competition between old-school telecom and upstarts like VoIP provider Vonage: Last week, AT&T announced its Unity pricing scheme, which cuts some roaming and per-minute costs for people who subscribe to both its wireless and wireline offerings. According to the company, which advertised the service heavily during Sunday’s NFL championship games, Unity potentially addresses a network of 100 million phone numbers.
Monday, Vonage countered by announcing its new V-Access service, a Rebtel-like plan which will give users EarthLink-type local access numbers to circumvent some long-distance or international roaming fees. To make the Vonage service work, you need Internet access (to find the numbers on the Vonage web site), then you need to dial the local number, then dial another number. Sound easy? Easier than Skype? Or easier than just keeping your AT&T service?
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Written by Paul Kapustka on January 23rd, 2007 with no comments.
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Didn’t take too long for AT&T to start showing why it’s good to be big: You can use your own network to clobber competitors in the pricing game. Friday morning’s salvo is an offer of free, unlimited in-network calls between Cingular (excuse me, AT&T Wireless!) cellular and AT&T landline accounts.
According to the AP story, the service covers about 100 million numbers, which are phones held by users who are suddenly saving money without doing a damn thing. Sounds like that iPhone just got a lot cheaper, one more excuse for Om to indulge himself come June. And VoIP providers who thought they could win by underpricing the incumbents? Welcome to round two.
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Written by Paul Kapustka on January 19th, 2007 with no comments.
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After attracting millions of users and billions in valuation, Skype is still seeking to answer the always-there question about whether Skype is a growth business. Thursday the eBay subsidiary unveiled yet another plan to try to tap into Skype users’ wallets, an all-you-can-eat SkypeOut service called Skype Pro which (like their Skype Unlimited plans for Canada and the U.S.) removes the per-minute charges for each call to the PSTN and replaces it with a small connection fee and a subscription cost.
Whether it’s a good deal for users is hard to tell at this point, especially since it’s only available initially in Europe. Clearly, more successful subscription models give Skype things it never had — contracts with users, and steady predictable revenue. Plus more cash up front, instead of waiting for people to call out to the PSTN to get paid.
Why is that important to Skype, more important than say figuring out how to be really disruptive again and move Skype to cell phones? Om noted a long time ago that there are still payouts tied to revenue figures. With Niklas Zennstrom back in charge, it’s not hard to figure out the motivation to get into serious competition with telcos the world over. Just add some cash to the bottom line, quickly! For customers, the question is — do you want eBay to be your phone company?
Bonus links: Skype Journal goes all PowerPoint to explain the latest move; and a reprise of Mr. Blog’s Skype losing-its-luster post, another good refresher on the why-more-paid-services moves.
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Written by Paul Kapustka on January 19th, 2007 with no comments.
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Sprint’s WiMAX investment is one of the most exciting drivers behind the mobile Internet this year. But whether or not Sprint will embrace the open model of the Internet or the traditionally closed way of the phone companies when it comes to its first WiMAX devices is still up for debate within the company — or so said Atish Gude, Sprint’s senior VP of mobile broadband operations, at a wireless conference on Wednesday.
Gude said that while Sprint eventually wants to embrace the open Internet-centric model for devices that connect to its WiMAX network — browseable devices and open platforms — the company is still wrestling with whether it should lean toward a closed or open model when it launches. “Do you start with an open model, or start with a closed model and move to an open model,” he asked. (Don’t ask consumers, that would be too easy.)
For example, Gude wondered whether the open Internet and browsing is necessarily the best service for WiMAX-connected dedicated devices like a camera or a gaming device with no keyboards. Gude seemed to think it was in the consumer’s best interest to take baby steps with a closed model and then slowly open it up. Yuck.
While companies that make consumer electronics like Sony (PSP), and Microsoft (Zune) have been going over this connected devices debate for awhile, it’s funny that U.S. phone companies are just starting to hash out these issues. I guess the carrier’s answer has been so obvious when it comes to mobile devices and the Internet, that it takes WiMAX to start up the conversation again.
Gude said a few other interesting things like how the consumer might pay for its WiMAX service: “An individual customer can have a subscription for multiple devices. . . ‘X’ number of devices. . .say an Internet connection is $30 or $40, then we think there will be a mobility premium of $10 or $15. We’re still figuring it out.”
On the topic of VoIP, Gude says, “In the Internet world VoIP is an application. . . we will be deploying VoIP as a service of our WiMAX network, but a dedicated standalone device? — the point is not to go back to the [voice-only] cellular network.”
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Written by Katie Fehrenbacher on January 18th, 2007 with no comments.
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It all began with an anonymous tip, about a new service called Shadow Number that allows you to make private calls from your mobile phone, while still retaining your privacy. Their sales pitch: ShadowNumber keeps your play life private.
Their flyer led to their Web site, and a click later it revealed that the Menlo Ventures-backed TalkPlus, a VoIP start-up was powering this new service. Their tag line: Calling for a Playdate!
… Instantly alter your caller ID, Shadow Number keeps your play life private.…
While the company made a couple of announcements at CES, there was no mention of Shadow Number. The company domain name is registered to a Toronto-based Canadian company called Contact Privacy, though it shared the name servers with TalkPlus. So we decided to check in with Jeff Black, CEO of the company.
“Shadow number is our brand for the alternative market,” Black explained it to us. “We are uncomfortable with putting our TalkPlus name, and are using the Shadow Number.” Black describes the “alternative market” as the adult market and that is on the fringe of that adult market.
Despite their self-claimed value propositions, most if not all VoIP start-ups face an uphill battle in terms of mass scale adoption. The desire for anonymity, especially when indulging in naughty activities, might be actually be their savior.
There are many reasons why people might want to keep romantic liaisons anonymous, from the simple (you’re just flirting) to the more complex (use your imagination). There is also a measure of safety in anonyminity, and the desire to keep potential stalkers at a hidden-number distance might well be an attractive service.
TalkPlus is just the latest amongst the VoIP start-ups to use the anonymity sales pitch. Jangl has signed a deal with Match.com, while Vivox has signed a deal with the WorldFriends’ Networks.
Some of us (including yours truly) may find Shadownumber’s pitch a tad distasteful, but it is an ingenious way for a fledgling start-up to popularize its offering. “There are certain markets that we think will have higher adoption,” Black said. It is a time-tested model for new technologies – go adult and go big.
Many new technologies — like VHS and DVDs, and more recently Video over the Internet — owe no small part of their early success to adult entertainment, which spurred people to jump through technological hoops they might not have otherwise. As long as no laws are broken, why shouldn’t VoIP benefit from satisfying the same desires?
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Written by Om Malik on January 15th, 2007 with no comments.
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Maybe it’s too soon for the good news to show up on Covad’s bottom line, but a report out today from In-Stat should cheer Covad strategists, since it claims that hosted Voice over IP services “will continue to experience dynamic growth over the next few years,” reaching the $2 billion mark by 2010.
Studies are studies, and it’s easy to point the graph up and to the right when you don’t have to close the sale. But there does seem to be a kernel of sense in the idea that very small businesses — In-Stat calls 20- to 50-seat deployments the sweet spot — would turn to an outsourced or hosted VoIP model, rather than looking for in-house expertise, software and infrastructure.
While Covad CEO Charlie Hoffman said earlier this year that VoIP overall and for small-biz specifically “isn’t yet at that hockey-stick growth phase,” he did say that small businesses are historically underserved, even though they represent a big part of the overall economic pie. And as providers add more functionality (like the fax-over-IP feature that Packet8 announced at CES), it sounds reasonable that small businesses looking to add functionality to their phones or lower their telephony costs would look first at a hosted VoIP model.
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Written by Paul Kapustka on January 11th, 2007 with no comments.
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The trials and tribulations of the competitive voice service provides such as Vonage, have forced venture investors to look at startups that marry VoIP to mobile phones. Any application that can lower the high mobile phone tariffs can quickly gain traction. And that is enough for investors, who ready to put down mega dollars.
You might have heard of names like Jajah, iSkoot, Mobiboo and Fring, with some of them getting big cash infusions from the likes of Sequoia Capital and Khosla Ventures. Add Truphone to this list. The UK-based mobile VoIP startup has raised £12.5 million ($24.5 million) in Series A funding from Wellington Partners, Independent News & Media, Burda Digital Ventures and existing investors Eden Ventures and angel investors.
The company plans to set up what it describes as a global Mobile Internet Network Operator. The company has signed up deals with Wi-Fi network operator The Cloud, which lends some credence to its claim.
Much as I like Truphone the application, I find the company has an uphill climb. The fancy MINO acronym might sound impressive but in reality Truphone will be fighting the battle for cheap minutes, which is great in early days but then it quickly gets old.
The only reason I use them is because the calls are cheap, cheap enough to make me wonder what really is the margin for Truphone after it has paid off the incumbent who terminates my call in India.
With multiple phones to support, one cannot overlook the problems and costs involved with developing and deploying software to many different mobile platforms. This at a time where there are competitors popping up all around them. Of course, what is to prevent the Vonages of the world to play the same game?
Here is the twister: if Truphone becomes really popular and is embedded in all phones, then you can make free calls to other Truphone-enabled phones. In other words no revenue opportunity, just like Skype. Forgive me for thinking, that this investment is laced with a dash of irrationality.
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Written by Om Malik on January 10th, 2007 with no comments.
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Reading the press release last night was a head-scratcher moment deluxe: Vonage is getting into the business of selling Wi-Fi? What, they don’t have enough scars from taking on incumbents in voice, now they’re going to butt heads over Internet access as well?
During a Monday morning phone call, we tried to talk some sense into Vonage chairman Jeffrey Citron, but he refused to be dissuaded. Bundling Wi-Fi will make it easier for customers to sign up for Vonage VoIP, he said. And if they are already Vonage customers? Lower acquisition costs, Citron replied.
Maybe it was the fuzzy connection (Citron said he was calling from one of the noisy show-floor booths Vonage has at CES, left), but we still weren’t convinced that reselling EarthLink’s not-so-fast Wi-Fi would be such a big bonus for Vonage. Since Citron couldn’t give us any pricing for potential service bundles — or specs on a promised Wi-Fi phone — it was hard to judge how much Wi-Fi might be able to add to Vonage’s shaky bottom line.
In our haste, we forgot to ask Mr. Citron how the added costs for ISP service and support would impact any broadband profits — since Vonage has had trouble scaling support just for VoIP in the recent past. But I bet it’s one we hear asked at the next quarterly call.
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Written by Paul Kapustka on January 9th, 2007 with no comments.
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Okay my VoIP start up friends! If you got something exciting and new - product, service or even a feature - you are eligible to enter the ETel Launch Pad, which is going to be held as part of ETel, the O’Reilly Emerging Telephony Conference. The event will be part of ETel’s opening ceremony on Tuesday evening, February 27, 2007.
ETel Launch Pad is co-organized with yours truly and co-produced by GigaOm. Entries will be accepted through Monday, January 22, 2007. You can submit your entry here. You want to get more details about the event, you can go here, or read all about it on the ETel Blog.
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Written by Om Malik on January 9th, 2007 with no comments.
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Google is offering click to call service to its Indian users. VoIP Inc. emailed us and let us know that they are partnering with Google on this new rollout.
The click-to-call service is no different from a similar service that the search giant started offering in the US in November 2006. Since then there was talk that the service was pulled due to prank callers, but it seems to still work in some cases.
Regardless, the wisdom of click to call features in India doesn’t make much sense, given the low PC density in that nation. If they are offering such features on their mobile version, it would make a lot of sense. Mobile phones are a more viable platform for offering new services in India.
Interestingly, the Indian government announced a ban today on Skype and other VoIP services such as Net2Phone. The government warned call centers and said they will face harsh penalties if they continue to use such VoIP services. Call center operators will have to furnish the names of carriers from whom they are buying bandwidth and VoIP minutes. The Indiatimes says:
The companies will also have to give an undertaking that they will not use the services of unlicensed foreign service providers such as Net2Phone, Vonage, Dialpad, Impetus, Novanet, Euros, Skype and Yahoo. As per Department of Telecommunications’ (DOT) estimates, these unlicensed service companies provide 30 million minutes of internet telephony per month to corporates, call centres and BPOs in the country.
For a country which views itself as part of Planet Technology, its government is failing to take into account the changing telecom and technology environment. These moves to ban low cost voice providers must have come at the behest of large phone companies - Bharti Telecom and Reliance Telecom - which are major long distance minute providers and of course, some of the biggest political donors.
Written by Om Malik on December 9th, 2006 with no comments.
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Pinger, a San Jose, Calif.-based voice messaging start-up, has received a fresh cash infusion to the tune of $8 million dollars, sources say. The latest round of funding includes previous backer Kleiner Perkins Caufield & Byers. DAG Ventures is the new investor in this round, and perhaps the lead investor. John Cadeddu from DAG led the investment. Company officials declined to comment.
Pinger launched at DEMO earlier this year, and is essentially the next generation voice messaging service. Instead of leaving someone a voice mail, you ping them, and that results in a text message being sent to them, which can be clicked to listen to that voice mail. Check out this DEMO video to get a better idea on how it works. Though quite simple, Pinger has a bit of latency in its user experience.
Last time we met with co-founder Joe Sipher, we chatted about that, and were encouraged that they were working hard to make the experience better. One suggestion we had for them: a Pinger widget that can also be put into our Netvibes page, or on our Vista desktop. Of course, a tiny Pinger widget for OS X: priceless.
Written by Om Malik on December 7th, 2006 with no comments.
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Written by Skype Journal on December 4th, 2006 with no comments.
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It has been quite a hectic few weeks in the VoIP world. New products, new services and well updates. Instead of dwelling on the whys and hows, I bring to you some of the more important news from the world of new voice:
- Fonality says about 1.5 million calls are being made every week using its PBXtra software, a modified version of the open source Asterisk software.
- USA Today reports that Jangl has about 275,000 users, many of them coming thanks to its partnership with Match.com. The private phone number movement is getting more traction, reports The New York Times, and points to PrivatePhone.com.
- Grandcentral has made all incoming calls free, and has enhanced their offering, which has improved quite a bit since we wrote about them.
- Businessweek reports that there have been 2,049 VoIP patents issued in the US to date. Companies that have filed for patents include Texas Instruments, Motorola, Nokia, AOL and Intel. In other words, wait and watch for a nasty outbreak of lawsuits.
- Asustek is going to make motherboards that will have phone jacks built into them, so common phones can be plugged into the computer and be used for Skype calls.
- GloPhone has upgraded their software.
- Globe Dialer, which allows cheap calls from mobile phones is now open for business in Europe. Switch-Mobile, the company behind Globe Dialer, calls its technology “electronic calling card” and competes with Jajah, MINO, and Rebtel.
Written by Om Malik on December 4th, 2006 with no comments.
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SIPphone, makers of Gizmo Project have developed a new web based, and very simple version of their VoIP offering. The new web-based service utilizes a browser plugin and is expected to launch sometime soon. It will allow people to make calls by visiting Gizmo’s website, logging in, and simply typing in the number they wish to call without needing the Gizmo software. It would be an easy way to make calls when using computers, at say an Internet cafe. Other features like presence indicator, and instant messaging are likely to be supported, though we don’t have first hand information on how these will work.
Written by Om Malik on December 2nd, 2006 with no comments.
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Vinod Khosla, who recently set up his own venture firm, Khosla Ventures, has invested $6.2 million in iSkoot, the Cambridge, MA-based Skype-to-mobile extender service, according to PE Hub. Khosla has become quite active lately and has invested in companies like Slide and iLike.
iSkoot has been getting a lot of buzz, especially after cutting a deal with Skype, and 3, a 3G wireless services provider. Soonr and EQO are other applications that act as Skype-to-mobile extenders.
Written by Om Malik on December 1st, 2006 with no comments.
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This morning there is a lot of talk over The New York Times story, The Air Is Free, about the coming onslaught of WiFi handsets and how people can make calls piggy backing on open wireless connections. The WiFi phones sound so cool, but many forget that what is cool, is not always that functional.
The consumer experience on these devices remains horrible, and logging onto a WiFi network remains as much a mystery as the Chicago Cub’s decision to give a $136 million contract to Alfonso Soriono. We have tried most of the new WiFi phones, and despite being ten feet away from the access point, have run into serious problems. Similar challenges crop up when using dual mode cellular phones such as the E61.
WiFi, is a bit of a black magic really, and even on laptops, one is challenged constantly to stay connected. It is good to see that there are others who are equally concerned about the consumer experience, though others are happy with the prospect of disruption. Of course, no one doubts the potential and the disruptive nature of these devices, but the hype needs to be tempered with reality. Other wise you are merely setting up phone buyers to be disappointed.
Additional reading: #1, #2, #3.
Written by Om Malik on November 28th, 2006 with no comments.
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It should hardly come as a surprise that we remain highly skeptical of the competitive voice service provider business, especially in light of recent shutdowns and overt reliance on discount pricing as a lure for the customers.
It was the same skepticism with which we approached our interview with Lisa Hook, Chief Executive Officer of SunRocket, the Vienna, VA.-based CVSP that has also raised substantial amounts of venture capital investment. Now it is a company that has been put under the microscope by us, and others who have bitterly complained about company’s infrastructure.
Hook, talked to us about her company, and the industry in general, and why she thinks SunRocket is going to be around, despite doubting Thomases. She was quick to point out that the company has grown from 50,000 subscribers at the start of 2006 to over 175,000 subscribers.
“We are taking a long term approach to the market, and are focusing on breaking even,” says Hook, “We are not interested in growth at any cost.” It was a subtle swipe at folks like Vonage, which are spending millions on marketing.
She believes that Vonage’s madcap spending is actually helping SunRocket, because it is creating a barrier to entry for smaller players. She acknowledged that there is no barrier to entry from technical standpoint, and the only barrier is capital.
“Why do we have to be number one? We are happy being number two to Vonage,” says Hook, and explains why. In the US, the Baby Bells and cable companies are the two incumbents, with Vonage as the third “voice” option. Cable operators, for instance are bundling their voice service at about $35-to-$40 a month, while Vonage and SunRocket compete on price.
Hook argues that cable operators have decent margins on their voice business, which allows them to maintain their current market capitalization. If they cut the prices too much, their EBIDTA will decline, and the stock markets would put pressure on their market capitalization. “They are not dropping prices anytime soon,” she says, which means that if you have enough fiscal discipline, keep your customer acquisition costs in check, you can survive in this cut throat business.
She argues that the numbers are big enough for SunRocket to build a big business. There are between six-to-10 million phone lines up for grabs every year, and Cable operators can easily take half of that market. It still leaves enough for the likes of SunRocket, she argues. “We have to focus on getting cash flow positive,” she says, “And then offer more than just cut rate voice service.”
SunRocket is planning on offering new devices including phones that will allow it to offer value added services including contact management, presence and find-me, follow-me type features. More than that, the company needs to address its biggest problem: poor after sales service.
Hook acknowledges that has been a problem in the past, and the company is working hard to rectify those issues. Hook says the company has a new billing system, a new ATA vendor (Linksys) and is spending on Network to address the customer complaints. “We have moved our customer care back to US from Philippines,” she says, “And we are spending a lot of time in Missouri to keep improving it.”
So while these are all encouraging steps by the company, and good arguments by Hook, we shall watch their progress closely, before being completely convinced of their chances.
Written by Om Malik on November 28th, 2006 with no comments.
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Jon Arnold, unlike many of us naysayers has become increasingly bullish on competitive voice service providers (CVSPs) such as Vonage and Telio, and predicts sunny skies for them. Since then several others have joined the conversation. Moshe Maeir of Flat Planet Phone Co. wrote to us and pointed to one of his posts, arguing that the numbers make CVSP a great business.
That is, if you don’t take into account the marketing costs, which even Arnold acknowledges, remain a problem for Vonage. Take for instance this recent promotion we received from Vonage. They want us to come back to service and they would give us two months for free. Or about a $50 discount, so the annual revenues are already down to about $265 per customer. Or the recent promotion Vonage is running with Circuit City, where they are giving away $200 gift certificate applicable towards a Vonage service.
The slowing subscriber numbers, and increased competition from the bigger, well-funded rivals such as Cable operators and phone companies, is our big concern, but hey that’s just us! We still remain highly skeptical of the current model where the competing on price.
The sharp increase in the numbers of CVSPs hitting the dirt might have something to do with our skepticism. As one of our readers very succinctly wrote, “Just like in the Long Distance industry, the cost of customer acquisition is too high and the retention is not there.”
The post first appeared as part of GigaOM Weekly Newsletter emailed on November 26, 2006.
Written by Om Malik on November 28th, 2006 with no comments.
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Written by Skype Journal on November 24th, 2006 with no comments.
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Written by Skype Journal on November 23rd, 2006 with no comments.
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Written by Skype Journal on November 23rd, 2006 with no comments.
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Written by Skype Journal on November 19th, 2006 with no comments.
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Written by Skype Journal on November 16th, 2006 with no comments.
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Conventional wisdom would say that more bandwidth is actually a good thing for VoIP. But that is not the case when it comes to ADSL2+, according to this article in the CommsBusiness. The article explains that in classic ADSL scenario when a file is being transfered or a VoIP connection is made, the bandwidth allocated to that connection remains constant, till say the transfer of files is complete or say the call is finished.
From what I understand it is like having a dedicated port and every subscriber gets a certain amount of bandwidth. In the case of ADSL2+, subscribers share the bandwidth at the local exchange level, and the bandwidth allocation is more dynamic. Carriers like ADSL2+, as it allows them to over provision, though it is not such a good deal for DSL subscribers. (I am sure some of you might have a more eloquent description of how this technology works.)
“This new technology uses a rate adaption policy which effectively means it can (and does) steal bandwidth dynamically from subscribers as and when required. We have seen upstream capacity decrease to lower than 57k in peak working hours which is simply not viable for a VoIP application. Period.” Scott Dobson, Managing Director of Newbury Based distributor Vcomm.
Written by Om Malik on November 15th, 2006 with no comments.
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We all know that people have been clamoring for a way to make Skype calls from their mobile phones. Skype, the company, has been a tad slow in making our wishes come true.
However, TalkPlus, a company we have written about in the past, has figured out a way to make Skype In/Out calls - no special Skype software needed. Watch the video on Skype Journal on how it is done, though I don’t think we kids should try it at home.
Skype Journal points out that “TalkPlus has engineered a server without Skype components that talks to the Skype network as if it were a Skype client using Skype’s own language.” Alec Saunders thinks “The impact on Skype/Ebay could be huge. Right now, Skype-Out minutes are free. Their revenue is from licensing, and from an annual 30 euro fee for Skype-In. Why buy a Skype-In number if TalkPlus can do the job?”
Me personally… I refused to get carried away… just yet! When millions use TalkPlus to place millions of calls to Skypers, maybe then it would be time to get really impressed. Up until then… cool video!
