ITEXPO begins in:   New Coverage :  Asterisk  |  Fax Software  |  SIP Phones  |  Small Cells


December 2006, Volume 9/ Number 12

Return to IT Table of Contents

In the CEO Spotlight section in Internet Telephony�, we recognize the outstanding work performed by exemplary companies. Each month we bring you the opinions of the head of companies leading the Internet telephony industry now and helping to shape the future of the industry. This month, we spoke with Ed Preble, Chief Executive Officer of Affinity VoIP Telecom.


RG: What is Affinity VoIP Telecom�s mission?

EP: We are becoming an early stage global leader of wholesale Voice-over-IP (VoIP) services and want to position our company as a viable acquisition target. To that end, we provide all the essential services a company needs to start and maintain a successful VoIP business.

For those who deploy their own switch and end user interface and sell VoIP services on a retail basis, we provide domestic, international, and toll-free telephone numbers, PSTN connectivity, E911 call routing, directory assistance and listing services, CNAM, codec conversion, and a host of other � la carte services. This allows our clients to offer comprehensive service packages.

We also provide a hosted, private label, self-administered partition on our class 5 switch for organizations that don�t own their own equipment. Many companies don�t want to make the large financial and time-consuming commitment of engineering a comprehensive, full-featured system. By going this route, a retail seller can literally become a full-featured phone company overnight.

RG: What is your vision for Affinity VoIP Telecom and how is the company positioned in the next-generation telecom market?

EP: I founded the company in 2005 before I had ever heard of Vonage (News - Alert). After evaluating the business case for the VoIP market, I came to realize that the limits for offering the service were not geographic but rather monetary. In other words, I could offer hosted VoIP telecom services on a global scale, but I couldn�t afford to market it on a global scale.

The only way to effectively reach the largest number of end users and create the most value for the company was to sell the services on a wholesale basis to resellers who had the marketing resources to sell to end users on a retail basis. It was at that point that I determined the vision of the company, which is to be the dominant leader in wholesale VoIP services by being the most recognized, prolific and widely-used source of wholesale VoIP services.

This vision has allowed us to pour all of our financial, engineering and development resources into a customized, one-of-a-kind partitionable system. This allows resellers with strong marketing skills and resources to offer hosted VoIP telecom services to end users and concentrate on marketing efforts while we focus on features, dependability and ease of use.

Our initial goal was to only sell partitions on our switch to private label resellers. We now generate a large portion of our recurring revenue by selling � la carte services to other companies who already have their own switch. In light of the changing landscape and industry demand for these services, we�ve expanded our � la carte offerings significantly to meet this growing demand.

Besides the extensive feature set of our switching equipment, one way we are positioned to realize our vision is that we maintain one of the largest in-stock inventories of immediately provisionable telephone numbers in virtually every domestic and foreign rate center available. We have found that obtaining telephone numbers from the CLECs is a time-consuming process, taking anywhere from one to four weeks. When reseller�s customers sign up for VoIP phone services, they don�t want to wait that long! Maintaining a massive inventory comes at a high cost. But its value comes in knowing our clients and their customers don�t have to wait for telephone numbers.

RG: Now that it appears that growth and opportunity are the trends in the VoIP industry, what possible hurdles do you see that might upset this momentum?

EP: Government intervention and regulation is a growing concern. Regrettably, I see the FCC (News - Alert) steadily reaching its tentacles into the VoIP business and imposing more and more fees and regulations on VoIP providers all the time. VoIP has enjoyed its present growth because, as part of the Internet, it had been left alone to develop. The FCC began by claiming authority over interconnected VoIP providers when it required them to implement E911 services in an overly aggressive time frame. Then it furthered its claim of authority by imposing costly CALEA rules over interconnect VoIP providers. This required that a nascent and poorly financed industry allow the government to listen in on VoIP calls. Its third claim of authority caught most of the industry off guard when it blindsided VoIP providers with a burdensome Universal Service Fund tax that members of the industry had little opportunity or ability to prevent. The Universal Service Fund tax imposes even higher taxes on the VoIP industry than upon Local Incumbent Carriers, Competitive Carriers or even wireless cellular companies.

VoIP has two main attractions, low cost and an increased feature set. Part of that low cost is derived from the fact that traditional carriers have had to charge so many added taxes while VoIP carriers haven�t had to pass on that overhead. Hopefully, the VoIP industry can become strong enough to establish a more powerful presence on Capitol Hill so the industry can continue to grow without the burden of government intervention.

RG: What are some of the technology areas where Affinity VoIP Telecom is increasingly focusing, and why are these areas important to the future of your company?

EP: Since the continued success of VoIP depends largely on the user�s ability to benefit from additional features and services that are not presently available through traditional PSTN services, we dedicate a high percentage of our resources to bringing new features to market as quickly as possible. Some of the technologies we are introducing now and in the near future include the following: A Dial Around service (no Internet connection required), multi-party conference calling, VoIP Peering (News - Alert), multi-product and multi-service billing capabilities, Video on Demand (VoD), SIP-based instant messaging, web-based calling (no landline phone required), endpoint remote auto provisioning and self-serve real-time telephone number acquisition services.

RG: Describe your view of the future of the IP telephony industry.

EP: I envision VoIP services providers to be as ubiquitous as ISPs. We�ve brought down the cost of market entry to become a global telephone company. In the coming years, there will be a multitude of private label VoIP telephone companies to purchase from. As the competition picks up, we will see resellers increasing their focus on vertical and local business markets. As the number of competitors increase, there will also be a misleading attraction for companies to compete based on price. Those who attempt to commoditize VoIP and compete on price will eventually disintegrate. In order to maintain price, resellers will need to include more features for the same price. It�s just like computing. Each year $1,200 just gets you a more powerful computer. But you don�t see many stores selling them for less than $500 and still staying in business. IT

If you are interested in purchasing reprints of this article (in either print or PDF format), please visit Reprint Management Services online at or contact a representative via e-mail at [email protected] or by phone at 800-290-5460.

Today @ TMC
Upcoming Events
ITEXPO West 2012
October 2- 5, 2012
The Austin Convention Center
Austin, Texas
The World's Premier Managed Services and Cloud Computing Event
Click for Dates and Locations
Mobility Tech Conference & Expo
October 3- 5, 2012
The Austin Convention Center
Austin, Texas
Cloud Communications Summit
October 3- 5, 2012
The Austin Convention Center
Austin, Texas