Telefonica Acquires VoIP Provider Jajah

Telefonica reportedly purchased Internet calling startup Jajah. This is expected to usher in big changes in the mobile phone market in Europe, according to analysts.

 

Spain-based Telefonica (News - Alert) acquired Jajah, which is a Voice over Internet Protocol or VoIP provider for $207 million. The company plans to offer Jajah’s calling service to customers of O2 initially. O2 is Telefonica’s European wireless unit. Telefonica is also a major wireless carrier catering to customers in Latin America.

 

“This is a very exciting union of a young, innovative company with one of the largest integrated communications companies in the world,” Trevor Healy, CEO of JAJAH (News - Alert), said. “Together, we look forward to creating the next generation of communication.”

 

Jajah and Skype (News - Alert) users make free or low-cost international calls using personal computers. Web calling on mobile phones has become common owing to the launch of Google Voice VoIP service in March 2009 by Google.

 

“Over time, more or less everyone will be using VoIP on mobile handsets,” Aapo Markkanen, an analyst at IHS (News - Alert) Global Insight, said. “Telefonica could offer its customers low-cost international calling via Jajah. VoIP would also make it possible for mobile phone users to talk with friends while sharing music, photos or other content at social-networking Web sites such as Facebook (News - Alert).”

 

Markkanen also said that the acquisition of Jajah seems to imply that Telefonica is employing a more rational approach to VoIP. Instead of rejecting it, the company is expected to accept it and innovate on new services in future based on it.

 

Matthew Key, chairman and CEO of Telefonica Europe, said that the acquisition of JAJAH broadens the scope of his company’s communications offering and also reveals new capabilities in the voice communication space. He said that people using social networking sites such as Twitter will have an even wider range of communications channels and have the option of speaking directly to each other as well as communicating by text or keyboard.

 

It is expected that the new 4G services will be much faster than the high-end 3G and will further boost VoIP calling demand. According to analysts Telefonica may offer Jajah services on 4G LTE networks it is planning to build and deploy soon.