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CommBytes 7/23/07 

July 23rd, 2007 by Carolyn Schuk

Pass me the Alka Seltzer. Last week’s news glut left me hung over. I feel like unless I can report on Harry Potter texting he-whom-we-are-all-sick-to-death-of on his Apple iPhone, what can I possibly have to say?

But at some point we have to get back to real life.

So here’s a virtual cool compress for your forehead in the form of some news you may have missed because of last week’s SunRocket wipe-out and Harry Potter and the Deathless Hype.

Last week UK firm Communic8 launched its Emporia Life mobile handset for elderly people, with user-friendly features like extra large buttons and display, super-loud volume (including the ringer), and a big red pre-programmable emergency button. BBC News story reports that retailers are snubbing the gizmo and are being accused of “ageism” by advocates for the elderly.

AT&T’s endorsement of openness for the 700MHz spectrum that will open up when analog TV goes away shouldn’t be a surprise. It’s a shrewd move for AT&T to tell Google in effect “put up or shut up.”

AT&T has been in the communications and consumer service business for more than a century. Google’s in the…search engine and advertising business. OK, they bought Grand Central. Forwarding calls doesn’t make Google a phone company. Whatever you feel about “Ma Bell,” give them credit for understanding the mandates of the voice communications business.

Kevin McLaughlin of CMP Channel offers insight into how another software behemoth is doing in the telecom business. Microsoft’s small business phone system, Response Point, evidently left VARs at a Microsoft Partner Conference less than enthusiastic. One described it as “semi-functional.”

The IPTV smorgasboard peeking over the horizon may be the oncoming train of an out-of-bandwidth Internet backbone. Wes Thompson of TVtechnology.com offers analysis.

Mobile email is the next big cash cow for service providers and network operators, according to joint report by open source software company Funabol and Frost & Sullivan.

Industry analyst Infonetics has a bouquet of free whitepapers including ones on indoor cell phone coverage and the evolution of VoIP over wireless LAN in the enterprise.
http://www.infonetics.com/services/green.shtml?whitepapers/whitepapers.shtml

Picking up the SunRocket pieces: VoIPVoIP is offering a BYOD pay-as-you-go deal for SunRocket refugees.

Patent Trolling: Rates Technology is now suing Qwest over VoIP patents. The Long Island company already has Vonage, Nortel, and Google feathers in its troll cap.

I can’t close without a Harry Potter comment. So here goes: Philip Pullman’s trilogy — His Dark Marterials, the first book of which, The Golden Compass, appeared contemporaneously with the first Potter book — is far more complex and compelling than Rowling’s septet. And it ends before your interest in it does.



Packet8 Takes a Lead 

July 18th, 2007 by Carolyn Schuk

Packet8 has inked a deal to be the preferred replacement for SunRocket subscribers left high and dry when SunRocket abruptly shuttered its business operations this week.

The deal was signed, according to the press release, with “with an organization managing the wind down of SunRocket, Inc” — presumably Sherwood Partners LLC, the company named in other news stories about the defunct VoIP provider. SunRocket subscribers can port their numbners to Packet8’s $24.99/month unlimited calling with a free month of service and no start-up or equipment costs.

In a change from the disgraceful way the company has handled its end-of-life so far, SunRocket will be calling and emailing subscribers about Packet8’s offer.



Packet8, Others, Picking up the SunRocket Pieces 

July 17th, 2007 by Carolyn Schuk

SunRocket generates more interest dead than alive. The VoIP pure-play’s skulking exit has garnered attention from MSNBC, the International Herald Tribune, The New York Times and the Washington Post, just to name a few.

Other VoIP companies are wasting no time offering special packages to stranded SunRocket subscribers. Vonage is offering two months free service. Nuvio today announced a special $199.99 plan for former SunRocket customers. As I wrote yesterday, VoicePulse has been quietly helping SunRocket subscribers stay online.

Packet8 is also rolling out its own “no startup cost” plan for SunRocket customers — offering equipment, start-up, shipping and one month of service at no cost with its $24.99/month unlimited calling plan.

“We think we can port those customers fairly quickly because we use many of the same underlying carriers,” says Huw Rees, Packet8 Vice President of Sales and Marketing.

I confess, I like this story because it contradicts the Silicon Valley catechism, where it’s an article of faith that the race is to the swift despite the received wisdom of our ancestors.

In fact, it’s looking more and more like our ancestors were right, and the fastest and most aggressive don’t necessarily get the trophy. And they don’t for reasons that are yawningly simple and straightforward.

The first is that other people’s money is not a substitute for revenue — you need to sell your product for at least as much as it costs to deliver it. The second is that controlling your own product is a more secure foundation than reselling other people’s technology.

VoIP pioneer Packet8 presents an object study in these pedestrian principles, and it’s apt that SunRocket’s sunset coincides with the dawn of Packet8’s 20th year in business and its 10th year as a publicly traded company (NASDAQ (CM): EGHT).

A longtime developer of communications chips — Packet8 components were used in AT&T ‘s Picturephone — Packet8 offered one of the first consumer VoIP services in 2002.

“Since we launched our service, we charged customers a fair price, one that lets us cover our costs and make a small profit,” explains Rees. “We priced it so it’s a self-supporting business.”

Faced with cut-throat competition like SunRocket’s $199 pre-paid two-year service deal, “we decided not to compete,” continues Rees. “We know the costs of delivering service and it was obvious that the costs were greater than that.

“We focused more marketing effort on the small business market. Once you get that right, it’s a higher margin of profit. It really bolsters the bottom line.”

That strategy paid off. With about 8,000 Virtual Office subscribers, Packet8 is the number one U.S. provider of hosted PBX services for small businesses, according to a 2007 study by telecom analyst AMI Partners.

At the same time, Packet8 never lost sight of the consumer side of the business.

“We have 100,000 consumer [accounts] and those are key because that base provides us with economies of scale — for example, PSTN termination.

Internally-developed technology is another key to Packet8’s stability — a contrast to SunRocket which licensed its technology from other companies.

“We have 68 patents in this [VoIP] technology,” Rees explains. “We co-invented the technology. Because we control the technology, [we control] quality, reliability, scalability. Over the long term, it’s helped us reduce our cost base because we don’t have to pay anybody for anything.”

All of which leaves Packet8 sitting pretty. “Last March we were close to cash flow breakeven and we’ve been improving that quarter-by-quarter,” Rees reports. “We’ve got over $12 million in the bank, $54 million in revenue last fiscal year — 67 percent over the previous year.”

Even with the SunRocket promo, Rees adds, “we’ll still make a profit and that should be good news for customers because we’ll still be in business.”



SunRocket Folds 

July 16th, 2007 by Carolyn Schuk

Predicted by many, VoiP provider SunRocket’s demise today was noted even by the New York Times. So far it appears that it’s every man for himself on the SunRocket Titanic, with management nowhere in sight and the company website still on autopilot.

So what do subscribers do now? It’s no surprise that at least one VoIP provider is looking to help SunRocket customers out.

“We’ve reached out to Sherwood Partners [the consultants handling the SunRocket shut down] today,” says VoicePulse CEO Ravi Sakaria. “We’re able to provide a migration path. We use a lot of the same underlying carriers as SunRocket.”

That means that many SunRocket subscribers can be up and running on VoicePulse VoIP service within 24 hours. Even before today’s dénouement, VoicePulse saw an influx of SunRocket customers, Sakaria reports.

VoicePulse offers an interesting contrast to SunRocket and one that should be of interest to VoIP industry analysts. The privately held New Jersey company has been profitable or at breakeven for the past three years, according to Sakaria.

The company’s recipe is like that of the tortoise of the well-known fable.

“The secret was to not pour a lot of money into marketing, and [aim for] slow and steady growth,” explains Sakaria. “We’ve offered unlimited calling for $24.99 a month for three years and we’ve never varied. That’s the price we needed to charge to be profitable.”

VoicePulse’s strategy has yielded about 40 percent growth year-over-year, every year, according to Sakaria.

“Four years ago when we launched the company we were seeing a 10, 20, 40 year endeavor,” continues Sakaria. “When you do that you have the mentality of how to develop a profitable enterprise and grow it from there.”

When you do this, he explains, you have the resources to reinvest in the business. For example, VoicePulse is getting ready to turn on a new, west coast POP which will deliver better redundancy for customers.

“We’ve been able to do that because of the money we generate,” he says. “Rather than struggling to stay alive, we’re able to bring customers a better calling experience.”

Not that Sakaria wouldn’t like VoicePulse to be a VoIP name brand.

“I would love for VoicePulse to be a better known brand, but not at the expense of operating at a loss. We haven’t figured out how to do that better than we are and still at a profit.”



CommBytes 6/28/07 

June 28th, 2007 by Carolyn Schuk

As might be expected, even before the Apple iPhone hits retailer shelves, its sexy features are showing up on other handsets. Like visual voicemail. German company SimulScribe just announced a “downloadable visual voicemail application” — SimulSays Beta — for the BlackBerry 8800 series, BlackBerry Pearl, BlackBerry Curve and Windows Mobile. The service normally starts at $10 a month, but the beta is free. However, in its rush to get the news out, SimulScribe appears to have forgotten to put the info on the website.

Dual mode phones just might be crossing the chasm and T-Mobile may be positioning itself for a spot at the head of the pack. This week the company launched the T-Mobile(R) HotSpot @HomeSM service. And coming along for the ride is the Nokia 6086 dual mode phone, also announced today. At home and in hotspots, calls are made over the WiFi network. Leave the hotspot, and calls automatically go through T-Mobile’s GSM/GPRS/EDGE wireless network. The press release lets you infer that the handoff is seamless, but I’m dubious because it doesn’t say it directly.

And speaking of WiFi, Mountain View, CA-based startup WeFi is opening up the beta of its WiFi community. WeFi helps you find and connect to free WiFi hotspots as well as keeping track of keys for locked and for-fee services.

If your idea of meal planning is ordering Chinese takeout, this isn’t for you. But for those of us who have wished we could look up a recipe for an item that’s on sale, Allrecipe.com’s new mobile service is just the ticket. Just type “Mobile.Allrecipes.com” into the phone’s Web browser.

Packet8 is sweetening the pot for customers, especially Virtual Office business customers, with “digital courier service” from YouSendIt.com, that makes it easy to send very large files electronically. It’s designed for files like video that can’t be sent via email, but it also works well for sending photos and large documents. I use it to send audio files of interviews to the archivist at my local library, and can attest to the ease of use.

It had to happen: iPlayboy widget for your Apple iPhone. Now do you want to buy one?





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