23 thoughts on “Nothing But The V-Thang”

  1. Hello Om,

    thank you for quoting my blog post in your article.

    Another fact to keep in mind is that the European regulators (after having cut in july 2007 the roaming prices for European MNOs up to 70 per cent) are now dealing with the termination fees which MNOs charge for incoming calls.

    EU commissioner Viviane Reding said last week that she wants to reduce these tariffs drastically. This touches the Holy Grail of the European telecommunications industry since it’s a main source of income, especially for Behemoths like Vodafone.

    In Cyprus the national cap for calls to other networks is at 2,25 cents, in Poland 16,49 cents. The real cost should be about 1 cent or less.

    That’s why regulation is on the agenda. I guess, at least in Europe, mobile phone calls will soon come down to very modest prices after years of rip off. Let’s see where this leaves Cubic Telecom and the like.


  2. The reason the industry is in a rut because it is focused on VoIP – it is immaterial whether voice is carried over IP or circuit switched network. The real breakthrough is Signaling over IP (SoIP). So what we need to do is focus on developing products and services that take advantage of SoIP.

  3. James is right .. VoIP is dead. We are old friends from the ENUM days. Signaling over IP aka ENUM/SIP is starting to permit VoIP interconnection across domain boundaries which is interesting but the real story of why no one hears that much about VoIP is that the global voice service itself is all going to mobile platforms. Landline VoIP simply does not make sense to anyone under the age of 25. Adding voice to social networks is interesting but hardly revolutionary.

  4. We will have to prove you wrong then OM,after all you did vote us the company most likely to be around in 5 years time.
    Our major interest is in developing markets, I totally agree with you on your post today that me and you don’t need to know how to make calls any cheaper but there are millions of people globally who are trapped in a cycle of expensive calls still.

  5. From a journalist’s and technology enthusiast’s point of view, maybe VoIP is a little dull, but you need to think about the consumer’s point of view. If the market is so stagnant then why do I have to keep looking for the best solution to make all the calls I need? As it is, I’m still splitting my dollars between Skype, Y! Messenger, one of Pat’s services, and VoIP Cheap. In a perfect world, I’d use one service to make all the calls I need, but there isn’t a solution that provides everything I want. Until one is created (or an existing one evolves), I’ll be following all the “cheap call” news with great interest.

  6. Raymond,

    you should call your local phone company and cable company. see how low prices have gotten and if you are a non-geek consumer, you are getting a pretty good bargain.

    i think we forget that in the end, cheap calls are done best by the big players. that is one of the reasons why low cost flat rate plans from incumbents are quite popular.

  7. You are right on the money Om. We were all so excited about the prospect of voip changing the whole game plan and replacing the circuit switch network. It’s never going to happen. The recent sun rocket debacle and vonage struggle clearly shows pure voip services companies will struggle to survive. I was very upbeat about the prospect of VOIP innovation happening in web 2.0 space. I believed that innovative VOIP services rather than pure voip services are going to make it big. Off late, I have started to loose that hope. I couldn’t recollect any VOIP innovation in the web 2.0 space that is revolutionary. Look at jaxtr, they started as VOIP widgets for social networking, Later changed their business strategy to focus on international voice calling. Having said that, I still feel we could achieve lot more using IP has a platform. I see great potential in Services Over IP ( SOIP ).

  8. I’ve always though that VoIP is a feature, not a standalone service. Maybe the right metaphor is ingredient. If VoIP can make your product better, good, but otherwise who cares? Vanilla extract is crucial to many a tasty cookie, but I’m not too keen on sucking it straight from the little brown bottle.

  9. After reading it again I think this post is too US centric. The world is bigger.

    In Europe often there is no option to “call your local phone company and cable company” and “see how low prices have gotten”. Pure VoIP still undercuts every phone or cable company offer, especially when it comes to international calls. The incumbents still don’t use their scale advantage which leaves room for VoIP players.

    The Sun Rocket debacle is no example for the entire world but just a case from the particular country USA where phone calls are cheap anyway.

  10. Agreed that incumbent will always win a price war, if they choose to fight it. As such, the value in any VoIP offer must be more than price.

    That is not a new idea; some of us talk about it several years ago. But till today, I havent see any interesting play.

    Jesse comments about VoIP is right on the mark. Cubic telecom is interesting not because it uses VoIP but because it hides it from the user. 🙂

  11. Let me just put the notion that Cubic Telecom is all about “cheap calling” to bed once and for all. We’re not. We never have been and we never will be.

    We’re about better value. If you’re paying $1 a minute for a call now we’ll get it to you for 20 cents. If rates from the carriers come down to 20 cents we will find a way to get it to you for 4 cents and we’ll still make good margins.

    We’ve made money this way for the past 5 years. We know what we’re doing and we’ll just keep doing it.

  12. This comes down to sunk costs. For the largest phone carriers (landline & cellular) the incremental cost of a minute is pretty close to 0. There is no big cost advantage that VoIP has over existing networks. The cost of acquiring customers and customer service on the other hand decrease as you scale. If the killer app for VoIP is a (cheaper) phone call, they will continue to struggle and die.

    Yes, VoIP have hurt profitability for the big carriers but just because you hurt the big guys doesn’t mean you automatically capture the lost value.

    If any of you has questions about this. Call me!

  13. Om

    Yep there is more coming than cheap phone calls.
    Look to the Sylantro Global Summit next week and who Sylantro is partnering up with, ie Cistera Networks and Aastra.

  14. why is anyone still talking about “VoIP”? The geeks from 1997 called and want their acronym back.

    if you’re an entrepreneur and you’re still using this term in your pitch somewhere, you’re missing the forest for the trees.

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