Alec Saunders SquawkBox

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.

Two quick news items from yesterday:

• Mobivox continues to add free calling countries.  The addition of Bulgaria, Cyprus, Czech Republic, Latvia, Lithuania, Norway, Slovakia, Slovenia and El Salvador brings the number of countries where free calling between Mobivox users is available to 40. 
• TalkPlus adds iPhone to it's list of supported handsets. Some of the TalkPlus feature set overlaps with iPhone, but TalkPlus' unique ability to set the outbound caller ID differentiates it nicely.

For the last week I've been using a promising new application called TalkPlus on my Nokia N95.  In beta now, it does three things:

1. Allows you to attach more than one phone line to your mobile phone.  There's no need to have multiple SIMs or accounts.  Rather, TalkPlus lets you simply add phone lines — like your office line, your personal mobile phone, and your home phone — to your handset.  You can also add virtual lines, which simply terminate on the cellular handset.  From that point forward, any calls you make can be made presenting the caller ID that you choose. 
2. Allows you to save money on your phone bill by making every cellular call into a local call.  That means I can call friends on the west coast, or in Europe, but only pay for local Ottawa minutes (plus a few pennies per minute to TalkPlus).  With the confusing array of cellular options available, this means a radical simplification for many of us.
3. Host conference calls from the handset.  Simply select the people you wish to have join the call, and it will call them and bring them into the call, using the same low TalkPlus rates.

Getting started with TalkPlus is easy.  Visit the TalkPlus web sign up, create an account, select a TalkPlus viritual number, specify your mobile phone number, and wait.  A short while later a text message arrives in your inbox which allows you to do an over-the-air install.  Once completed, visit the applications menu, select TalkPlus, enter your account information, and you'll be up and running.

Note: if you're a heavy address book user (I tend to synch everything from Outlook to my phones), the application MAY crash.  Current betas have trouble with some of address fields in the phonebook, and work best with just names and phone numbers.  So for now, don't synch Outlook with your phone.  Simply add a few numbers.

The first place to visit is the profiles page.  There you will see that you have a device profile, and a TalkPlus number profile.  From here you can simply select a profile, and make a call.  Whichever profile you've selected will be the caller ID which is presented to the recipient of the call. Calls made using the TalkPlus virtual number are billed at your cellular rate, plus the TalkPlus rate.  Calls made using your device profile are billed at your cellular rate alone.  Calls made to the TalkPlus number ring through on your telephone when dialed.  In addition, you can also add other profiles, such as a work number, which you can select as your identify for outbound calls. 

Next visit the TalkPlus phonebook.  Here, on an individual by individual basis, you can select which profile will be the default profile used to call that person.  From that point forward, whenever you make a phone call the caller ID of the profile which that person is associated with will be used, and calls will be billed at… you guessed it… your low price local calling rate plus TalkPlus' nominal rates.

In addition, TalkPlus allows you to select multiple people from your address book, and have them conferenced together.

It also provides a voice mail box with a nice visual voice mail feature (take that iPhone!), and the ability to be notified via SMS when new voice mails arrive and to send those voice mails to your email box. 

TalkPlus features are also accessible from a web site.  In addition to the features available on the handset, the website allows you to make outbound calls a la Jajah, apply some basic filtering criteria to incoming calls, and manage account settings.

TalkPlus draws together threads from all of the major VoIP / Voice 2.0 themes many of us have been writing about in the industry.  For instance:

• You can have up to 10 virtual numbers.  With their voice mail features, and conferencing, this will makeTalkPlus a credible unified communications solution.
• You can have those 10 virtual numbers in any location you want.  Now individual business people can easily have a presence, with calls terminating on their mobile phones, in any of the cities they do business.
• TalkPlus disintermediates the cellular carrier for long distance.  It will save people outside the United States (like we poor abused Canucks) a ton of money on cellular phone plans.

Features I would like to see:

• iotum-like call filtering.  The filtering in TalkPlus is primitive today.  I'd like to be able to automatically reroute calls to my deskphone or cellphone depending on time of day, caller-ID, what I am currently doing, where I am and other criteria.  The most important, though, is time of day.  With unlimited evenings and weekends common on cellular phones, I want to redirect incoming calls to my deskphone, minimizing daytime use of the cellular phone in order to save money. 
• presence.  I'd like to know the availability of folks before I make the call. 

One nit: choosing to focus on Nokia handsets is a little puzzling.  While the Nokia handsets are superb, a unified communications application like TalkPlus more properly belongs on a business handset such as Windows Mobile or BlackBerry. In conversation with TalkPlus CEO Jeff Black last week, he indicated that BlackBerry would be their next focus.

Nevertheless, the TalkPlus beta is very impressive.  It's solid, and has many useful time and money saving features. And for devotees of Jajah, Truphone and Rebtel, like myself, it has raised the bar on the user experience. 

The beta is currently open.  If you've got a supported telephone, click here to give it a try.

Jangl officially unveiled their beta this morning. Available everywhere in the US, on any mobile handset, and targeted at the same dating crowd as TalkPlus, it seems as if the companies must have been in an unofficial horse-race to get their beta’s into market. 

Free until sometime in 2007, Jangl allocates a new number for each contact, and based on a combination of call-in number, and caller-id, determines where the call should terminate.  It’s a very clever system, and just the ticket for people who value privacy.

I had a chance to talk with Jangl CEO Michael Cerda, and Tim Johnson last night on the telephone about their beta, which they characterize as being more like the Google Beta, or a Skype Beta — out there for a while to gather user feedback, and validate some of their ideas.  The idea is to use the Jangl branded beta to vet those ideas, and then roll them out to their partner networks, like Match.com (announced last week).  So, Jangl direct will hint at future, and is the place where you will see the early adopters. They have a bunch of ideas around SMS, and MMS and publishing content to a phone number that they will explore. 

Jangl sees itself capitalizing on the benefits of anonymity and privacy. The basic thrust is that people, more so now than ever, meet other people on line. Most are people you’ve never met face to face.  In addition to phone calls there are all kinds of other places to embed their service.  For instance, Michael talked about building a widget for myspace or blogs allowing customers totake advantage of the ubiquity of the internet, while preserving the anonymity. Click the widget, and have a privacy protected conversation with the blog owner.   In fact, they see users having multiple Jangl ID’s for different roles –myspace, business.  Marshall, over at TechCrunch, is a skeptic about the value of the business Jangl ID, but who knows?

As always, I am interested in funding stories.  They closed $2 million in funding 12 months ago, and another $7 million last July.  With just $1 million they got Match.com into a pilot and private beta, and it was then that they raised the other $7 million.  One of the secrets of keeping their burn low is having just 18 people.  The other is that, even just 5 years ago, they would have had to build their own infrastructure.  Today they “rent” the infrastructure from Synoverse and Level 3. 

Nice job!

I asked about a developer play.  Not yet.  They haven’t figured out the details of how to handle third parties being able to programmatically create Jangl numbers.

911?  That’s handled by the network operator, not them.  No problem.

Law Enforcement?  Handled by the infrastructure owner, not Jangl.  No problem.

Jangl is neat, and another great example of a new Voice 2.0 application made possible by the shift we’re experiencing in the telecom market today. 

TalkPlus announced a US West Coast beta today.  For customers on Cingular, T-Mobile, or Sprint, you can get a second number for your cellular mobile — a TalkPlus number.  The idea is that the number can be used as a “second line” for business, dating, classified ads, online auctions, social groups, or for a second residence. TalkPlus works like your current mobile phone number, with the ability to make or receive calls from anyone, anywhere, at any time.

Billed as a “Sneak Peek”, the limited beta started today.  Beta participants get a TalkPlus Number within California or a selection of other major US cities.  Mobile users can sign up by visiting www.talkplus.com.  All beta participants get a FREE 30 day trial which includes 250 domestic minutes of TalkPlus service.  Participants who successfully complete the beta program will receive one additional month of free service (not including any overage charges).

I’m bummed that it’s not available here in Canada, or any of the handsets that I own.