Once upon a time (1996, to be exact), there were two gentlemen named Ofer Gneezy and Gordon VanderBrug, who had “a garage” and big plans. They started a VoIP provider called ChipChat. By the time Yours Truly visited them in 1997, they had changed their name to VIP Calling (which stood for Voice over IP Calling). They had just opened a new gateway and switching facility for the global VIP Calling Network the 8th floor of 111 Eighth Avenue in New York City, just a few blocks from my editorial offices on 21st Street and Fifth Avenue. VIP Calling had signed a ten-year lease for a considerable amount of acreage in the building, which had once belonged to the Port Authority of New York. I marveled at the heavy-duty electrical capacity, the prime power back-up generators and a cornucopia of fiber-optic services. The space housed VIP Calling's recently deployed Cisco (News - Alert) gateways and switches that would handle the kind of reliable and scalable VoIP services worldwide for which VIP Calling would become famous.

 

By 1999, when it came to Voice-over-IP services, there were four major players: AT&T, deltathree (News - Alert), IDT and VIP Calling.

 

The name “VIP Calling” began to feel “small” and limiting, however, as the company moved from proof of concept to selling to Tier One carriers. The company needed a brand name that sounded both substantive and at the same time would suggest a broader vision for VoIP. Since the company realized that the Internet would eventually be the basis for the majority of global communications, they re-branded the company with the name iBasis (NASDAQ: IBAS) – for Internet-based communications.

 

iBasis then installed at various POPs Vienna.way gateways from Vienna Systems (now part of Nokia (News - Alert)), which began to form a network covering several worldwide locations, including cities in the United States, Japan, Korea, Hong Kong, and Israel. The gateways take a voice signal, compress it, convert it into packets, and then route those packets to the POP closest to the call destination. The destination POP decompresses the signal and sends it over the PSTN to the call destination. By March 1998, VIP Calling had announced a DS3 upgrade to connections at super POPs in Los Angeles and New York, with two of the three connections in both cities dedicated to Internet access and a third reserved for voice traffic.

 

Over the years, the iBasis business model has remained remarkably consistent. They’ve focused on international traffic, where they could offer customers the greatest cost savings and garner some decent margins. They also focused on being a wholesale business, which allowed them to skirt the costs of retail customer acquisition and support. While other start-ups of the time attempt to emulate ISP peering arrangements for VoIP or attempted to conquer PC-to-Phone consumer services, iBasis became a prestigious carriers’ carrier business. And on October 1st 2007, iBasis officially merged with Royal KPN N.V., the national carrier of the Netherlands. Essentially KPN’s international wholesale voice business were merged into iBasis, with iBasis now defined as a KPN affiliate. The combination immediately made iBasis one of the three largest carriers of international phone calls worldwide.

 

And now, iBasis has introduced its expanded portfolio of international voice products, designed to fully address the needs of all telecommunications market segments from cost-driven wholesale carriers to retail mobile operators worldwide. The new portfolio represents the integration of products and capabilities iBasis acquired through its October 2007 merger with KPN Global Carrier Services (KGCS) from Royal KPN N.V., the national carrier of the Netherlands. That transaction positioned iBasis as one of the three largest carriers of international voice, expanded its global footprint and customer base, and gave the company the massive scale necessary to be a leading player in the ongoing consolidation of the international voice industry.

 

The best-of-breed portfolio includes international voice services that offer a range of code coverage, pricing and advanced features. It addresses the requirements of fixed carriers, mobile operators, consumer voice over broadband carriers, and prepaid calling card service providers that comprise the more than 1,000 iBasis carrier customers around the globe. The portfolio leverages the iBasis global VoIP network, as well as TDM infrastructure acquired in the KPN transaction, and iBasis’ patented quality monitoring and management technologies

 

Christopher Lengyel (News - Alert), Director of Product Management at iBasis, says, “What we’ve done for the past two years internally and one year publically, after the announcement of the KPN acquisition, we been combining and streamlining our product portfolio. So as I’m sure you’re aware, iBasis had a huge billion-minute-a-month IP network and KPN has an equally huge TDM network, so as you can imagine, it’s no small task bringing together our new wholesale voice product portfolio. We had examined the various customer types, customer segments, and their needs. We were able to leverage the advantages of both the IP and TDM networks to come up with this new portfolio.”

 

“We have made a great deal of progress on integration since our transaction with KPN last year,” said the President and CEO of iBasis, Ofer Gneezy. “Our ability to offer a comprehensive product portfolio that addresses the international voice requirements of virtually every segment of the industry is a significant competitive advantage. As more and more carriers seek ways to enhance the profitability of their international service, iBasis offers compelling solutions ranging from select destinations to total outsourcing of international voice.”

 

The iBasis International Voice Product Portfolio consists of the following:

 

• Direct Voice: Provides wholesale carriers access to iBasis’ lowest-cost routes and direct pricing for highest possible savings. Providers are selected on cost and voice quality, while capacity and coverage are managed to minimize costs.

• Value Voice: Expands on Direct Voice by adding select providers to increase coverage and reduce variation in the major metrics while maintaining competitive rates for wholesale and retail operators.

• Certified Voice: Ideal for retail operators and consumer VoBB providers requiring full calling coverage, high route stability, call completion and capacity.

• Premium Voice: Offers mobile and retail operators guaranteed features and exceptional voice quality using direct connections with incumbent carriers and qualified providers. Includes advanced features such as guaranteed CLI, fax and roaming.

 

In addition to the expanded International Voice Product Portfolio, iBasis has completed the integration of its Mobile Matrix™ collection of value added services for mobile operators, including messaging interworking, global mobile signaling, preferred roaming, 3G video telephony, roaming integrator services and GRX.

 

The expanded voice portfolio and value added mobile services are available now. Current iBasis customers are already being migrated to appropriate products in the new iBasis International Voice Product Portfolio, a process expected to be completed during Q4 of 2008.