Alec Saunders SquawkBox

Yesterday’s 2008: The Year that VoIP Died generated a slew of interesting responses.

Jon Arnold and Andy Abramson wrote me in email to say that I had made the same points that they had.  While it’s true that I made many of the same points, my view of their meaning is perhaps different.  I don’t see a bright future for those who are in the “VoIP business”.  I do see a very bright future for communications innovators.

In 10 points about the death of Voice over IP Ted Wallingford lists his own reasons for believing that VoIP is done, including noting the fact that “Everywhere you look, former VoIP honchos are turning to social media applications as a focus area–from Jeff Pulver to Ken Camp to myself. It’s a trend. Social media is where the opportunity for innovation in unified communications still exists.”  There’s some truth in that statement, no doubt!

On Twitter, VoIPSupply’s Garrett Smith and I mixed it up, with Garrett asserting that “VoIP lives – just not how it was once thought of by the collective.”  I should clarify that I believe strongly that there will be a market for the VoIP communications devices and products that Garrett sells. They’ll be sold as “Unified Communications” products and platforms for businesses.  At some point in the not too distant future VoIPSupply will likely re-brand — away from VoIP.

CircleID’s Ali Farschian also contacted me and asked if he could repost the piece on CircleID.  It generated two comments, one agreeing  and one defending Vonage.  And, not to be left out, Ali also reposted Jon Arnold’s original piece. 

In VoIP is NOT Dead, Jeff Pulver wrote his rebuttal, finishing with the line “VoIP is dead.  Long live VoIP.”  Interestingly enough, in the first draft of yesterday’s piece, I alternated between using that same line as both a subtitle to the original title, and the closing line, before landing on “Ding dong, VoIP is dead”.

Andy Abramson’s one-liner in comments simply said “The real point is VOIP is NOW part of Telecom and it is now Mainstream.” Amen to that sentiment, but it doesn’t go nearly far enough.

Ken Camp declared the whole discussion boring, noting that he had written the same commentary on VoIP as plumbing at several times in the past and finished with the immortal one-liner “2009 – No bullshit. No VoIP. Be real and create real solutions for communications.” Ken then tagged the whole post “beating a dead horse“.  Lee Dryburgh agreed saying “plain VoIP is quite frankly boring. Cheap calls generally with inferior quality. Nothing to stay up on a Saturday night about.”

And we said all of this without one reference to Skype, cloud computing, or the intersection of voice and the web. More on that tomorrow. 

Keep those comments coming, and Happy New Year!

It seems highly likely to me that at some point in the future we’ll all look back and say that 2008 was the year that the VoIP industry finally died.  With all due respect to my very good friends Jon Arnold, and Andy Abramson, it’s about time.

Voice over IP is just a transport and signalling technology. It’s plumbing.  It may come as a surprise to some of you to know that in the late 1980’s and early 1990’s there was a TCP/IP industry as well. TCP/IP is inarguably plumbing.  As the IP stack became common on all computing devices, TCP/IP went from being a differentiator to a commodity.  The short lived TCP/IP industry was a footnote in the events that spawned the global web. The fact that a VoIP industry has existed is a similar historical footnote to the transformation of the communications industry as a whole.  The VoIP industry was a necessary phase in that transformation; John in the wilderness announcing that the real action is still to come.

And what is the evidence that the VoIP industry is at that turning point?

Where have all the pure play VoIP companies gone?  The last of any consequence still standing is Vonage.  The S&P is down about 40% for the year, and Vonage a whopping 70% save for a miraculous gasp in November at the point of the announcement of their debt having been refinanced.  The fact of the matter is that Vonage is in an impossible place.  Phone calls are cheap enough, Vonage is undifferentiated from any other phone service, and … the cable guys have television.

Will this be the Vonage’s last year for the zombie shuffle?  Or can they pull it off again, and come back from the dead once more?

VoIP events are suffocating too.  VON was a spectacular flameout, despite the best efforts of Jeff Pulver and his band of merry men to transform it from a voice only show into a voice, video and more show.  At least the Pulverites understood where the future was, even if unable to craft a profitable event around those varied interests.  There’ll be more of the same next year, I fear.  Initial reports from this fall were that VoiceCon was an understated and quiet affair.  Lawn bowling anyone?

Another sure sign of the ill health of the VoIP industry is that the feature companies are heading to the deadpool, as well.  2008 started as a year full of VoIP companies trying to make their mark with free “products” that were features in disguise.  Needing to find a revenue model, many turned to advertising and cheap minutes and ran smack into the same wall that Vonage is heading toward at light speed.  Bye bye TalkPlus, Jangl, and so many more.  And suddenly, late in the year, Jaxtr lurched back from the dead with another free calling service…

The smart vendors have learned that consumers don’t want another telephone company built around a complicated piece of technology in their lives and those vendors have done one of three things – they have transformed themselves into a platform play (think Mobivox), into a wholesale player (think Jajah) or into a full-on competitor in the traditional telecom space (think TruPhone and the build-out of their global network).  Taking their cue from BT’s $105 million buyout of Ribbit, these companies are positioning themselves as players that are part of the communications ecosystem, rather than apart from the ecosystem. 

Why?  Well, the big VoIP stories this year were that ecosystem of applications, and platforms. 

• Irv Shapiro’s IfByPhone ingeniously connected IVR and Google Analytics, allowing deep measurement and statistical analysis of call center traffic. 
• Mashup king Thomas Howe demonstrated over and over that with the right tools, building communications applications can be as simple as building web sites. Tom stood on stages in front of audiences, built applications and won contests and plaudits by concretely showing that voice is now just software.  The subtext?  The magic of software lets you embed voice into any application that you like.
• Like Tom, we at iotum used modern platforms to release Calliflower in record time. We can turn around code on a two week cycle not because we’re smarter than everyone else, but because of the tools we use to do the job. 

Building communications applications with today’s infrastructure compared to what was available even five years ago is comparable to digging a ditch with a backhoe instead of a pickaxe. 

Most interesting, perhaps, is the fact that the service provider and the equipment manufacturer seem to be blurring at the moment.  As the equipment industry has become mired in the complexities of defining and delivering a common application standard (think IMS), carriers are starting to go their own way – BT’s acquisition of Ribbit is an obvious case, but what of Orange’s developer camps (now in their third year) and the way in which the mobile industry has rushed to imitate Apple’s success with iPhone, both platform and store.  These moves betray an understanding that the future is in software, in applications, and in building products that deliver end user value rather than shaving the corners off pennies.

And what of the companies that are failing to make that transformation?  Pity the Nortel shareholder as Nortel has seen over $250 billion in market cap erased in the last five years. 

Ding dong, VoIP is dead.  Let’s dance on its grave and get on with the business of transforming communications in the twenty-first century.

On December 9 we talked with InnerPass Executives Steve Parsloe and Bill Trail about the launch of their Inner Pass “Share, Collaborate, Communicate” Certified Skype Extra – a web-based persistent document sharing service that supports conversation and collaboration activity by invoking Skype voice services and Instant Messaging (chat) as well as screen sharing. A basic use case scenario would be where a project administrator or team manager creates a virtual “meeting room” with a set of project- or task-related documents, such as engineering drawings or legal contracts. The host can then invite other team members or individuals that he wants to have access to the room. The documents are accessible at any time by the meeting room members whom also have the ability to upload their own files and add additional participants. The files can be stored for as long as they are needed for the project and controlled with a version management process. When the relevant team wants to hold real time conversations they can either launch an “instant ad hoc conversation” or schedule a meeting and launch a conference call and/or team chat session via Skype’s multi-party calling and group chat services. Team members can be brought into voice conference sessions via either Skype or SkypeOut.

For this call Steve hosted a desktop sharing presentation that demonstrated how rooms were created and how conference conversations (voice and/or chat) were set up. InnterPass is a hosted work or community team-building service with additional tools for screen sharing, email, inviting and removing team members as well as the level of member participation permitted. Since its mid-October launch there have been over 42,000 downloads of their Skype Certified version.

During the call there is mention of a GoToMeeting session; while we could not record that, the PowerPoint deck used at that session is attached.

On the Calliflower Conference Call today: Jim Courtney (Moderator), James Body, Bill Trail, Steve Parsloe, William Volk, and Sergio Meinardi .

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 SquawkBox Dec 9 [23:37m]: Play Now | Play in Popup | Download

Nokia’s latest experiment with social media is online.  Called IDEAS it’s billed as “an interactive conversation about connected commerce and culture.  It’s a new way to interact with thought leaders and their ideas.“  The idea (pardon me) is for visitors to play the short video clips or read the material supplied on topics ranging from the human genome to social media, and then engage in conversations with the thought leaders presenting the ideas.

It’s an intriguing concept. The site is pretty, and very large with much to explore.  I was disappointed, however.  There doesn’t seem to be a lot of commentary. Perhaps that’s because the ideas being offered are so thin.  For example, August Capital’s David Hornik can no doubt contribute much more on the topic of applications becoming social than these 11 seconds.

I’m left with the impression that this is a work in progress.  Let’s hope.

Under CEO Peter Diedrich’s guidance, Mobivox has been slowing transforming itself for some months.  Beginning with their announcement of the Mobivox|PL voice services platform in September, the company has revealed an impressive series of customer wins.

And now the next phase of their evolution is being revealed.  In Telecom CRM 2.0, Diedrich makes the case for Voice CRM (customer relationship management).  He writes:

Every time end users – whether our own or those of our partners – access our platform, they ‘talk’ with a personalized and provider-branded voice assistant. Placing a call, creating an entry in the hosted address book, dictating and sending an SMS or email message, or conferencing are all done through a Voice Assistant. In essence, a natural dialogue with the customer. This in effect presents an opportunity to ‘talk back’.

In Mobivox’ whitepaper Voice Activated Mobile Services Platform the company elaborates, noting:

Extensive user data is gained and stored on the platform to be exploited for user  experience and customer relationship management purposes; data is used at the discretion of the partner. Data elements include but are not limited to:
• Home location
• Registered phone numbers
• Call origination, destination and duration patterns
• Feature usage data
• Inventory of contacts (including quantity and location information)
• Spend patterns
• Language preferences
• VUI interaction behaviors and preferences

How the carrier partner chooses to use that information is discretionary, but the whitepaper outlines a number of possible use cases, including upsell conversion, payments and more.

They’re only scratching the surface, of course.  Once you understand a little about customer behaviour, the opportunities to mine call detail records and other kinds of user data being collected become truly limitless.