Project REBOOT: IP Telephony is exciting again!

When we look back at IP Telephony (or what was called in the ole days – VoIP), we can discern three unique stages. Stage I – the invention and introduction of VoIP services by the likes of Vocaltec, Deltathree etc. Stage II – the launch of Hosted Services by companies like Vonage, Packet 8, Ring Central and of course yours truly. Stage III – is just starting and is truly exciting.

We can define Stage I by calling it the “Pipes Era”, replacing legacy telecom pipes with shiny new VoIP pipes that transport the bits and bytes of our voice from one side of the world to the other at very low cost. Stage II – has become known as the “Cloud Era” where new providers took legacy phone systems and trucked them over to “The Cloud”.

Ok, so we replaced the pipes and removed the boxes from our offices. Bottom line we are talking costs savings and some convenience, but where is the innovation?? Well it is almost here! Continue reading

The End of the Minuteman

In the late 90s, selling minutes was a big and very profitable business. Companies like ITXC, IDT, Net2phone, Deltathree traded in the billion dollar range. They were innovative and created a whole new landscape.

Fast forward to 2008, IDT (and Net2phone now a fully owned IDT subsidiary) is almost done burning its 1 billion dollar pile of cash and is on the way to be delisted from the NYSE with the stock trading at around 50 cents. Deltathree, already delisted from the NASDAQ, is trading at 6 cents and rumors abound that they are about to close. Even Kayote which was founded by Deltathree veterans with a much more service orientated business model, has closed down their “minutes” operation in the last week.

The advent of Asterisk and other open source switching solutions enables anyone with a few dollars to put together a switch and sell minutes. All you need is a PC, a PRI card and you are in business. My guess is that these Mom & Pop operations put the big guys out of business.

Where does that leave us? Services, Services, Services. There is plenty of money to be made in the value added arena. Integrating and streamlining business processes with voice and video is still a big business and will be for years to come. Those who understand that will also make money from minutes as an add on. Selling minutes alone is unfortunately, as these former leaders are showing us a sure way to go bankrupt….