September 27, 2004

A Bit of Self Promotion

A column in Toronto Star, September 27th issue (via Pulver) gives a summary of the recent hearing conducted by CRTC. The following snippet caught my attention:

The final view that stood out was the one taken by Telus Corp., Canada's second-largest phone company and the incumbent in Alberta and British Columbia.

Telus stressed that a distinction should be made between a VoIP service that is sold by a telco as part of their high-speed Internet service, versus what it calls an "access-independent" VoIP service, which is essentially a software application that can ride over any high-speed connection from any service provider from Canada or around the world. …

She seemed to catch the attention of the commissioners on the hearing panel. After Telus made its presentation, many of the questions asked of other companies were directed at this concept of access-independent VoIP.

"When you're reasonable, people tend to listen to you," said one CRTC insider.

Now this is what I said back in April:

PSTN regulations depend upon the classification of the service provider – ILEC, CLEC and resellers. The classification will be carried over. So an ILEC in PSTN will be an ILEC when they offer VoIP in their own territory. This is at odds with their stated goal. A proper analogy will be to decide the classification based on who owns the broadband access facility. So an ILEC for VoIP will be one who owns the access facility and offers the service. For example, Verizon will be an ILEC when they offer their service to their DSL customer; but will be a CLEC when they offer VoIP service to a Comcast customer, even though these two customers happen to be in the same geographical area where Verizon is an ILEC PSTN service provider. I firmly believe that facilities owner will have an advantage; hence the bias against them.

Posted by aswath at 11:42 AM | Comments (0)

September 21, 2004

PSTN Disrupts VoIP?

It is a conventional wisdom that VoIP will disrupt (if not already) PSTN. The marquee player usually quoted is Skype because of the low cost. Now comes the news (via Stuart Henshall) that “The Skype phone rate is about 50% higher in Sweden then the regular phone.” (Message posted by kento on Sep 20, 2004 8:52 AM).

By the way, did you know that there are people who used Skype for a while but then stopped using it? Horrors, really. 22 million downloads, 700,000 simultaneous users, 1.5 million minutes used, … Time to add additional statistic? Anyways, they are trying to find out why.

Posted by aswath at 01:37 PM | Comments (1)

September 16, 2004

The Lure of Virtual Numbers

AT&T today announced among other things that they will join other VoIP providers in offering additional numbers from different geographical area. These numbers are called “virtual numbers” and are associated to the primary numbers and when calls are received for a virtual number, the call will be diverted to the primary number. The service objective is the same as that of Foreign Exchange service or toll-free service of PSTN, except now it is applied to consumer market as well.

Before Skype became the darling, Vonage was considered by many regulators and industry luminaries to be the pacesetter. Virtual Number service was often mentioned as an example of revolutionary services afforded by VoIP technology. Subsequently almost all the VoIP providers started to offer the same service at almost the same price of approximately USD5 per month. Indeed they all allow for any number of virtual numbers to be associated with the primary number. But AT&T will issue a maximum of 9 virtual numbers. I guess the research folks at AT&T Labs have a valid reason for this restriction.

Not being a business guy, I wondered the business model behind this service. How is it that the service is so inexpensive? Indeed, VoIPuser gives away virtual numbers in UK and will terminate the calls to not just any SIP or IAX2 destination, but also landlines in selective countries for, get this, free! For me this all the more remarkable, till I realized that they are taking the kickback charges they receive for terminating the call, to pay for the forwarding of the call.

Given the service offered by VoIPuser (and soon to be joined by LibréTel), one clearly observes that VoIP technology is not needed in the access to offer virtual number service. More importantly, another “revolutionary service” afforded by VoIP turns out to be an arbitrage play. What happens to the viability of the business plan of this service if the “bill and keep” regime advocated by many VoIP players is indeed instituted?

Update: I should have included an analysis of Skype related service SkypeIn. The service offered by VoIPuser and LibréTel is equivalent to what SkypeIn will be. This means SkypeIn fee is bounded by that of VoIPuser (which is 0) and USD5 per month. Also, Skype can offer a new service to PSTN users like VoIPuser and LibréTel, that is offering PSTN LD service. The fee will be bounded by VoIPuser (which is 0) and SkypeOut (per minute by destination based charge).

Second update: Please visit VoIPuser forum to read some comments on this entry from one of its founders.

Posted by aswath at 12:00 AM | Comments (0)

September 15, 2004

VoIP is a commodity …

And only a vanity toll-free number will save you! So it seems: “As VOIP services have quickly become commoditized, even before they’re fully available, marketing, branding, and price will be among the key differentiators of consumer and business VOIP providers. “Based on the wide array of new entrants into the VOIP space, from cable operators to telephony behemoths, consumers will be overwhelmed by their choices. Something as simple as the phone number can help tip a customer’s decision toward that one provider that is able to break through the marketing clutter.”

So rush now and get the rights to 1-800-GET-VOIP by calling … Sorry I forgot the number because it was not a vanity number.

No mention about other prefixes, especially 866 (VON).

Posted by aswath at 12:12 PM | Comments (0)

September 09, 2004

ISPs and Unauthorized devices like ATAs

I just finished reading this incredible news item from Hong Kong. It seems the dominant wireline telephone provider PCCE sent a letter to its broadband customers informing them of the risks associated with VoIP. They even mention Vonage’s recent outages as evidence. One can take issue with their point or dismiss it saying that the customers will be wiser.

But they also make a policy statement: “You should not be connecting your Netvigator broadband service to any unauthorised device other than your personal computer, as this may affect the quality of your broadband service,” For me this is unfathomable. Even if the local regulations allow an ISP to stipulate it, I wonder how they will know whether a customer is using an ATA or a softphone running on a PC. Next, are they going to list the approved applications that can run on the PC? If browser is such an approved application, what about the applet? Where will it end?

To repeat myself once more, the ISPs must be regulated at least to the extent that access is equally open to all applications.

Posted by aswath at 03:30 PM | Comments (0)

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