Skype-o-Rama: Why VoIP matters again

Who knew? Last we’d heard, the VoIP and Web-based calling business was fading, with companies like Vonage having a hard time competing and upstarts like Jangl calling it quits.

But all of a sudden, VoIP news seems to be everywhere, and almost all of it good. Skype, of course, selling out at a price that values the company at $2.75 billion, more than the $2.6 billion eBay paid for it (a seeming minor miracle). Vonage’s stock soaring last week, then falling back slightly, before heading upward again as its iPhone app was officially approved. VoIP Web calling and SIP backbone player Jajah inking a deal with Microsoft. The profile of Google Voice rising at last, at least in part due to its much-noted trouble getting in to the iPhone store.

So why is VoIP suddenly so hot?

A few thoughts come to mind:

- Mobile apps are cracking things open

Part of the challenge for VoIP services has always been cracking the distribution/channel problem. How do you get your service in front of customers? Standalone software clients, PC headsets and embedded call widgets are easily trumped from a usability perspective by traditional phones and cellular handsets. Ease of use is not even in the same ballpark, especially for the mass market. Mobile apps change that. iPhone customers are used to, make that “love to” download new apps. Barrier to entry for mobile VoIP players is now getting approved in the iPhone (and other) apps stores, a barrier that appears to be getting lower and lower.

- Mobile VoIP is becoming real

It’s still far from perfect, but the pieces are coming into place to make mobile VoIP a reality. Data services are more widespread; operators are facing pressure to not block the service; mobile apps are integrating mobile VoIP services right into a device’s main dialer/address book; WiFi is becoming ever more available and new networks like WiMax and LTE will soon offer even greater bandwidth. Research shows that mobile VoIP is becoming more mainstream and mobile operators may even need to support it to thrive.

- Choice is appealing

It’s still much easier to make a call using a wireline phone or mobile device, but consumers have shown they aren’t against taking a couple of extra steps — such as use a calling card — to save significant money or have a better user experience. The global nature of most VoIP services is also a boon and another market in which users aren’t against working for greater savings or convenience.

- The FCC is watching

I don’t think it’s a coincidence that all of this activity started just after the FCC looked into the Google/Apple/AT&T case (with Apple equivocating and saying it wasn’t against the app per se and AT&T even volunteering it might be more open to mobile VoIP in the future). And even more recently, the FCC launched a fairly open-ended inquiry into the entire wireless industry. Upstarts sense change in the air (and see blood in the water) with the very real possibility that even more openness and structural change could be coming to the telecom/wireless industry.

-Real-time is in and VoIP clients are really UC clients

Telecom is real-time, of course, but increasingly so is the Web — with Twitter updates, Facebook messages, etc. etc. The truth is, real-time VoIP clients like Skype and Google Chat/Voice are really about unified communications more than anything, with built-in IM/chat and even text messaging along with voice calling. Could a desktop/mobile app VoIP client be the wedge behind which unified communications becomes mainstream? Just by asking that question you can see why Skype would draw such interest.

- Unleashing the value in Skype

Speaking of Skype, perhaps the most interesting question will be to see whether its new investors can help Skype take off in ways it never could under eBay’s wing. eBay bought Skype on a flyer when a few billion dollars barely dented its balance sheet. But it never really focused on building the business. Savvy tech investors are going to see more in — and expect more out of — the company.

Do you have any other reasons for why VoIP and VoIP companies are suddenly garnering so much attention? Please share them in the comments below.

One Comment to “Skype-o-Rama: Why VoIP matters again”

Leave a Comment

Acceptable Use Policy

Enter the word as it is shown in the box above.
If you can't see the word, refresh the page.


September 2009
« Aug   Oct »

Your Account


Subscribe to RSS Feed

Subscribe to MyYahoo News Feed

Subscribe to Bloglines

Google Syndication