Alec Saunders SquawkBox

The chess pieces have been moving around the VoIP board for the last couple of hours.  I’ve recently gotten mail on:

• The Comcast Cablevision announcement that it has passed 1,000,000 VoIP subscribers.  Om Malik observes that this is putting pressure on the incumbent carriers, but also makes life much more difficult for Vonage.  Indeed, Cablevision operates in just a few states as compared with Vonage which is an international carrier.  Vonage stock is down again, now below $7.
• The Nortel / Microsoft announcement of a new research partnership, which, according to Microsoft VP Jeff Raikes, will ultimately result in the sale of new products and services through a joint channel.  Because it’s a research partnership, this will be a longer term play. However, public cloud presence plays, like Tello, are going to come under pressure as a result.  For now, the alliance’s focus on enterprise and carrier means that there is plenty of room to innovate, even though the stakes have just become higher.

 We live in interesting times.

Ben Edelman’s revelation that Vonage customer acquisition is built around spyware advertising leaves a bad taste in the mouth.  Before the IPO it might have been explainable as the actions of a few overzealous affiliates, but in the post IPO era, the recipients of those ad dollars are available for anyone to see.

One wonders how long a business model built on customer acquisition via spyware can be sustained. 

I am continually amazed by the ubiquity of Asterisk.  Asterisk based carrier class systems are popping up like mushrooms.  Why? The expense of deploying one of these systems is truly disruptive.  Built on commodity hardware, they can be deployed for amounts less than $0.50 per subscriber, and scaled for even less.  Compared to traditional TDM based systems, they are ten times less expensive to build.

For example, over the last couple of months, I’ve seen numerous companies building carrier grade platforms around Asterisk, each with a different strategy for scaling.  For instance, Teresto, has approached the problem from the point of view of compartmentalizing every feature of their system. Need ringtones?  That’s on one Asterisk server.  An IVR?  That’s on another.  They’re demonstrating the flexibility of Asterisk, while isolating individual functions in a highly fault tolerant architecture. 

David Troy’s PopVox proposes an open source telephony platform, which he calls AMFORA, based on Asterisk.  AMFORA is: Asterisk, MySQL, FreeRadius, OpenSER, Ruby on Rails, and Apache.  At this point, he’s on his fourth generation of best practices deploying this platform, with successful installs in Brazil, the US, and Europe, including an install at Cogent. 

Because Asterisk based systems can be built and scaled so easily, new services can be crafted and test marketed with minimal expense. If it takes off, then scale it.  If not, then you know you built the wrong thing.

The giveaway that a system is using Asterisk? Allison Smith.  If Allison is the voice of a new service, then chances are it’s built on Asterisk.  For instance, the much-promoted Jajah is built from a foundation of one Asterisk feature, the outgoing call spooler. Radio Handi’s voice conferencing service?  Built around Asterisk.  PhoneGnome?  Asterisk in the back end — you can hear it in PhoneGnome’s voice mail system. 

Asterisk has given these developers a huge advantage by providing cheap, workable call control, in source code.  It allows them to focus on building innovative customer services, while the open source community takes care of the nuts and bolts of the platform.

11 Suggestions for Not Being a Dot Bomb 2.0 has a lot of useful stuff for entrepreneurs and those who aspire to entrepreneurship.  Particularly important was point #2: be a complete business, not just a feature.  What’s the service or product you offer to your customers?  If you can’t define this without another party’s offering then:

1. your value chain just got one step longer, which means your one step further away from revenue, and one more piece of complexity stands in the way of reaching your customer.
2. reaching that customer means first selling another member of the value chain on why they should buy (or integrate) your feature into their product, versus simply buying it themselves. 

Some entrepreneurs believe that being an OEM component in someone else’s business, or a feature added to someone else’s product, will lead to an easy exit.  For all but a few, it leads straight to the dead pool.