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February 2009 | Volume 12/ Number 2
The Zippy Files

VoIP Dead? No, We’re All Just Blasé

The telecom industry’s latest tempest-in-a-teacup occurred as 2008 faded into 2009. There’s been an uncommon excess of profound meditation among industry pundits over whether VoIP is “dead” or not. I think this all started (or at least picked up steam) with Alec Saunders (News - Alert) blog, “2008: The Year VoIP Died,” which culminated with the earth-shattering observation that, “Voice over IP is just a transport and signaling technology. It’s plumbing”.

Everybody else then weighed in, from the distinguished Jon Arnold to the former Bacchus of VoIP himself, Jeff Pulver (News - Alert), co-founder of Vonage (and my former boss), who took time to proclaim that “Since the birth of the VoIP industry, the millions (maybe Billions) of dollars of VoIP Telco infrastructure that has been purchased, and will continue to be purchased, has been meaningful for quite a number of companies. So in real life, VoIP really isn’t dead. For some people, VoIP has become a word associated with ‘network plumbing.’ And in that perspective, I can appreciate why some of my friends no longer believe that VoIP is cool. From my own perspective, I miss reading stories about startups prepared to leverage the concept that ‘Voice is just an Application’ and empower a new generation to communication in ways which were not possible or practical in the past. Something more than Skype and something different than Vonage (News - Alert). What we are missing are the totally disruptive startups willing to challenge the status quo.”




He’s right, of course. The network operators, carriers and providers that comprise the status quo, like the Borg in the TV series Star Trek, are rapidly assimilating that new transport and the tricks it can perform. The things an exciting new startup could offer 10 years ago can now be found as part of a feature set in a unified communications suite, or embedded in a service bundle offered by a cable company. Over the years we’ve been bombarded by so much hype, bells, whistles, and pronouncements of world-shaking transformation that we overlooked the genuine maturation of VoIP.

After all, the VoIP journey started with Jeff Pulver screaming about “free phone calls over the Internet” in 1994, and in the years since then we’ve become accustomed to the miraculous aura of IP and the cornucopia of products and services spewed forth from vendors and service providers that would revolutionize everything. As it turns out, IP has revolutionized everything, but minus the fireworks. It’s now a part of your routine. It’s why we sleep with our 3G phone and use our laptop more on the road. It’s why we teleconference rather than spend hours and days on an airplane. It’s why we can now work 18 to 20 hours a day instead of 8 or 12.

And yet companies focused exclusively on the magic of VoIP (i.e., Vonage) exasperate Wall Street. Innovative competitors, ranging from Skype (News - Alert) to scads of little next-gen VoIP providers that purport to leave the PSTN behind but tend to run atop much of the older telcos’ infrastructure, have demonstrated that it’s too easy to enter the industry and merely provide VoIP service. The revenue “pie” gets cut up into too many pieces, much to the chagrin of formerly starry-eyed investors.

Like a 1960s radical who sold out to The System, VoIP went from being “highly disruptive” to “radical chic” to “mainstream ho-hum”. VoIP is now simply a workhorse component of today’s tantalizing products and services: unified communications, wireless broadband/4G mobile and upcoming intelligent systems for workforce management and communications-aided business processes. Some of these will be provided by hopeful start-ups, but most will be dished out by existing cable companies and telcos. IT

Richard Grigonis (News - Alert) is Executive Editor of TMC’s IP Communications Group.

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