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How Can A Small Consumer VoIP Provider Survive

Tuesday, July 27th, 2010 at 3:18 pm  
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There is a lot of buzz about VoIP Internet phone service. On the consumer side everyone is getting a lot of exposure to Vonage commercials as well as triple play offers from Cable Companies. From a technology standpoint, VoIP is now much more mature than in its nascent days when Internet telephony meant a scratchy voice conversation over two computers. Whereas VoIP has been used by Telcos to carry voice traffic over long parts of their networks for years, it is now positioned to become the standard technology used to carry voice traffic over the last mile from every consumer’s home. Increased broadband penetration and advances in VoIP technology make this possible, and now there is a long line of VoIP providers out there looking for a piece of the action. They range from giants like Verizon and Comcast to relatively small unknowns. For the first time in the history of telecommunications it is possible to be a telephony provider without the huge barriers of capital needed for switches and network operation centers (NOCS).) nor the regulatory barrier of being a Local Exchange Carrier. So will the industry be marked by many small nimble players? What is the likelihood of survival for small consumer VoIP service providers?

The Cable TV companies have a strong position in the telephony market. They already have a large embedded base of customers. They also have a local presence, with field installers regularly driving around neighborhoods and customer service locations in every town in which they have a franchise. Having the field installers is a major advantage since they can install VoIP service and also hook up inside wiring so the service experience is no different than before. Therefore a person doesn’t have to be the least bit technically inclined to adopt the service, thereby opening the market to the masses. The pure-plays like Vonage just can’t reach the mass market like this.

Cable companies also have huge brand awareness in their markets. What is also potentially vital is that they are perceived as a utility company and people are used to getting phone service from this type of entity. There is a familiarity and comfort level of going to a utility company for phone service.

They also have tremendous strength in both billing and customer service. While some may despise the cable company because they have lengthy time windows for showing up for an installation, may show up late, and may keep you on hold at the call center, the Cable companies are in actuality very excellent at managing the complexities of their operations. For example, RCN entered some markets years ago as an alternate cable provider thinking they could leverage people’s dislike of the cable companies’ service record and do it better; instead they finished up realizing how very complex it is and finished up doing it worse. If a company wants to scale as a major VoIP provider, they will have to manage the complexities of billing and customer service. The cable companies have been down this road already.

Here is what could be the largest factor to why the Cable companies will be most successful at VoIP and ruin the chances of other smaller entrants – They provide a broadband connection. Since this is required for VoIP, the incumbent provider has the first dibs on providing voice service. Also, since broadband connections have high margins and VoIP has low margins, broadband providers could treat voice service as a loss leader to get and keep customers on their high-speed connections. NetZero, for instance, is giving away free telephone numbers and low priced VoIP service presumably with the hopes of signing on users for their ISP. Voice service could in fact become so commoditized that it will be given away with broadband service the same way email is today. If this becomes a reality, there would be very small market opportunity and a bleak survival outlook for smaller pure-play VoIP service providers unless they could offer a differentiated value proposition.

The Local Phone Company also shares many of the same advantages as Cable in that they have strong brands, ability to bill effectively, established customer service, and field technicians. They also should provide the greatest comfort level to people for providing a phone service. But, the Phone Companies have dismal showing compared to the Cable companies who have the greatest number of VoIP subscribers. Verizon VoiceWing and AT&T CallVantage each have only 5.5% of the 2.9 million pure-play VoIP subscribers (Telephia Q2 2006). Those 320k subs are dwarfed by the Cable Companies like Time Warner Cable who alone had 1.6 million VoIP customers as of October 2006. Why have the Phone Companies had such a dismal result? Internal confliction between POTS and VoIP is one reason. They can not place emphasis on a low margin VoIP product in their core offer and have struggled to make an effective bundled product strategy with advanced services. They are also expending more resources and internal focus on better broadband offerings than DSL and trying to break into video services. Nonetheless, they still hold second and third positions for share of pure-play VoIP subscribers and have deep pockets, which will allow them to far outspend a small VoIP provider to get mindshare.

Vonage, with 53.9% of the 2.9 million pure-play VoIP subscribers, is spending a ton of money to get mindshare and customers. This is excellent in that it raises awareness of the product category, which helps a smaller pure-play. But, it also presents a huge challenge for smaller providers to compete head to head for customers when a single provider has such a dominant voice.

There are a number of challenges facing a smaller VoIP provider. Small providers have to compete for share of voice against companies that are spending a lot of money. As far as the business case goes, VoIP has relatively small margins and the ROI for marketing campaigns and generating brand awareness is a challenge. Yet without spending money on marketing, it is hard to capture customers.

Then there is the challenge of the market size. Pure-play providers don’t have local installers and technicians, which limit the market to those who have the technical savvy to set up the service or the willingness to do so. If the target market is defined as people who have the technical savvy to set up VoIP on a home network, then this market is comprised largely of younger people. This group is increasing mobile based and has small use for a landline phone. Also, consider how the overall telephony market will change over the years. People in college now that will be graduating over the next couple of years and getting apartments are 100% mobile based and have never had a landline phone. Thus the market for pure-play VoIP will be shrinking as quick as it grows.

But, there is still an opportunity for small VoIP providers in this challenging market. The opportunity is to focus on niche markets and leverage specific advantages of VoIP that are particularly vital to specific customers segments. In such segments, word of mouth advertising is a viable strategy if the service can meet a strong need. This solves the dilemma of investing in media to build a strong brand and maintains better profitability.

ReVoS Internet phone service is an example of a small VoIP provider taking just this strategy. They are focusing on a niche segment of people who make a lot of international calls. ReVoS offers VoIP service, which includes unlimited international calling to over 40 countries including the standard VoIP product offering for $24.95 per month. They have also developed a VoIP product that works over a mobile phone that doesn’t require a broadband connection. This is geared to people of international origin who, by the way, have the greatest propensity to use cell phones of any demographic in the U.S. This niche makes sense since carrying long distance call traffic is an inherent strength of the VoIP networks. Also these customer groups are better reached through a niche strategy and would be missed by mass-market strategies. This market is comprised largely of people living in the U.S. who have went here from other countries. These are tight communities where word of mouth can flourish and the value proposition is strong when saving people money on high cost international calls. This is an example of how a small VoIP provider can successfully compete against much more formidable competitors such as the Cable Companies and Vonage.

But, the future of the telephony industry and the role that VoIP takes still needs to be fully defined and there are many uncertainties. There is a long list of unknowns, which include such things as Google getting into Voice and whether Microsoft includes a softphone and VoIP service as a standard part of their operating systems. Fixed Mobile Convergence (FMC) is another technology wildcard that could change the shape of the competitive landscape. The overwhelming penetration of mobile phone service and mobile carriers’ ability to steal the show with a FMC offer is very real. This may be the competing technology that upsets the MSOs stronghold on VoIP. The question then becomes which bundled product offer is greater 1) Broadband and VoIP or 2) Mobile phone and VoIP. Another thing to consider is how Wireless VoIP (wVoIP) could change the competitive landscape and underlying telephony ecosystem if municipal hotspots and/or WiMax take off.

Whatever the future the holds, the economies of the telephony industry are likely to place a few large carriers in control of the majority of the market. People want simplicity in their lives and the winners will be those who provide the most seamless solutions to people’s basic communications needs. For smaller VoIP providers to survive and make profit, they will need to meet strong niche needs that get overlooked by the mass adoption strategy, have a well defined and differentiated value proposition (Recall ESPN Mobile’s problem), efficient operations to control cost and low margins, low churn in order to compensate for limited total average revenue per subscriber (ARPU) absent a larger bundled product strategy, and the ability to benefit from viral marketing within the target markets. With all of this in place, there is a chance of survival for small VoIP providers.

RNK Telecom is a privately held phone company offering wholesale and
residential telecommunications services including VOIP Services. They market ReVoS, an Internet telephony product which offers superior International Calling.


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Cheap VoIP ? are you Getting the Most Out of your VoIP Service?

Tuesday, July 27th, 2010 at 9:09 am  
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Cheap VoIP – Are You Getting The Most Out of Your VoIP service?

If you are like most people, then you probably have heard of something called VoIP or voice over Internet protocol. The name may sound very technical but really, it is simply using the Internet to transmit a message from your end to the other party. Does it sound familiar? Maybe that’s because it sounds a lot like email or instant messaging– only, you can really listen to the message being said.

The nature of VoIP has really allowed the slashing of phone call bills to more than half of what it used to be. This is because there is less physical effort and resources needed to maintain the system and to make a call possible. There is no wonder then that VoIP service providers are coming up left and right offering the newest features at very low prices.

While that may sound fantastic at the start, choosing a VoIP service simply on the basis of it being cheap may become a source of regret and aggravation in the long run. So when choosing a VoIP service, try to balance affordability with functionality.

The thing about most VoIP services is that they astound you with so many cool features that you tend to overlook the fact that you may not really use those features on a regular basis. So it is best to keep a steady picture of what you need, rather than on what you want.

Now that you’ve been made aware of how to approach choosing a VoIP service, here’s a lowdown of what is out there and how they can address your communication needs. When it comes to such VoIP services, the usual suspects are Vonage, Packet 8, VoicePulse and VoiceStick. They vary in the features they carry as well as in price. A quick comparison follows for you to evaluate what you really need and what you want to have:

Hardware/Software-based

Software-based VoIP is easily the cheapest variant of VoIP service because it requires small more than a computer and a Internet connection (which you may already have). Besides Skype, which is more known for its free use, VoiceStick comes as a software VoIP paid subscription. The others are hardware-based VoIP.

Standard call features

Things like caller ID, call waiting and forwarding, voicemail, as well as 3-way calling, are basic features to most VoIP services. If you find a service provider that compromises on these features, then they most likely make up for it with the cost of subscription.

Optional call features

Anything from DISA (which allows you to call into and out of a system from any number) to fax capabilities are added options that can either give you greater functionality or a larger monthly bill. Choose if these features are something that can help you with your work. If it does, then by all means avail of them.

Now comes the price. The figures mentioned here work from a previous listing and so the package prices may change. To confirm these prices, consult the service provider’s official website or contact them directly for an updated quote.

Cheapest monthly plot

So far, the cheapest monthly plot goes to VoiceStick because it is a software VoIP. But among the hardware-based players, VoicePulse is the cheapest with just under $15 a month. The package features unlimited local calls and 200 minutes for long distance calls.

Signup costs

Before you can start your VoIP subscription, most service providers charge a one-time signup fee. Among the listed providers, VoicePulse costs the most at $40 while the rest charge only $30.

International call rates

You probably chose a VoIP to save up on long distance calls, so might as well choose a provider that can give you the best rates for calls made to different countries. Among the three hardware-based players, Packet 8 gives the cheapest rates per minute to countries such as the U.K., Australia and Beijing. Of course, given its software nature, VoiceStick still leads overall with under 2 cents per minute to the same countries.

This information has been given to you as a means to get started on exploring the right VoIP service for you. A cheap VoIP service can save you a few dollars a month, but if it does not give you the full benefits and functionality the VoIP offers, then you may want to rethink going simply for what costs the least.

Ivan Cuxeva Jr. is the webmaster of Voip Document. Compare the features between conventional and voip phone service and get the most out of your voip service . Visit us at VoipDocument dot com.


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Where can I find a FREE program to make free pc to cell phone calls?

Tuesday, July 27th, 2010 at 8:42 am  
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I am looking for a FREE program that will allow me to make free long distance calls to cell phones from my pc over my dial up internet connection.(not pc to pc calls). I would prefer a program that didn’t require registration if possible.

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Overcoming The Disadvantages And Improving the Quality Of VoIP

Tuesday, July 27th, 2010 at 8:39 am  
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VoIP is a fantastic way to communicate with family and friends at a very low price. But, there are a variety of hindrances with switching to VoIP. This article goes over many of the disadvantages of VoIP, which may have experienced. Additionally, this article will clarify how you can improve the quality of VoIP phone service.


Disadvantages of VoIP


Although there are many advantages of VoIP, there are also quite a few disadvantages. Below are four of the most common disadvantages of VoIP.


1. Maintaining a Dependable VoIP Internet Connection


If for any reason, you lose your internet connection, you will not have phone service. Therefore, you must use a cellular phone should this type of situation arise.


2. 911 Access


When you place a 911 call, the location cannot be immediately determined. Unlike PSTN, you must register your phone number online so that should you need to make a 911 call from your VoIP, emergency services will know your location.


3. Networks Have a Large Number of Computers Connected


If your network has a large quantity of computers connected and they are all using the internet at the same time, your VoIP quality will generally be less than desirable. One way to avoid this situation is to invest in an Ethernet.


4. VoIP Poor Quality


Audio quality is one of the largest issues. No matter what your VoIP service offers you, the basic role of any phone is voice communication. If the quality is not up to par, then there is absolutely no point to all of the bells and whistles that come with the service. If you have a lot of background noise, then a VoIP that can handle music, video, caller ID and a variety of other advanced features is practically useless. In the next section, we will address this issue more thoroughly.


Even with all of the advancements of VoIP, there are times when the audio quality suffers. Since VoIP relies completely on the internet connection, anytime the internet suffers so will the VoIP.


Six Ways to Improve the Quality of VoIP


Poor audio quality (disadvantage #4) along with dropped calls, are all complaints that user of VoIP tend to make. Below are six ways the setup of your VoIP can affect the overall quality. By following these simple steps, you can easily improve the quality of your VoIP service.


1. Internet Connection


One of the first recommendations is a high speed internet connection. There are companies which offer VoIP for dial up users. But, the connection can result in poor audio quality. Eventually, you will grow to dislike your VoIP. But, it is not the VoIP, but rather the internet connection. Even if you have DSL, there are occasions when the connection may be slow and your VoIP quality will suffer. Therefore, an Ethernet connection is highly recommended.


2. External Factors


Weather conditions, such as thunder storms, heavy rains and snowstorms can all can an increase in static on broadband lines. In some instances, simply turning rebooting the VoIP can solve the problem. Another solution to reduce the static is for the VoIP service provider to replace the cables with a higher quality cable.


3. Compression Software


The technical details of codecs are a bit too much for this article. If you would like additional information, you can go to Wikipedia. Here is a quick overview of codecs as it pertains to VoIP. When sending data, VoIP compresses it. This is simply because if the data is too large, transmission can be extremely slow and ineffective. Codec is a software program that can be used for data compression. But, a poor quality codec will lead to poor audio quality.


4. VoIP Location and Hardware


The hardware you choose for you VoIP can affect the audio quality. Most of the most vital pieces of hardware is the ATA/Router. The VoIP ATA or Analog Telephone Adaptor, brings ordinary phones to the networked world. The adaptor connects a phone handset to an Ethernet adaptor and therefore connects regular, analog phones with VoIP networks. If you are looking for additional information on ATA, check out Wikipedia.


In general, ATAs should have support for security and firewall, as well as echo cancellation and compression technologies. Many technicians have learned that certain VoIP equipment can interfere with each and possibly make feedback or buzzing noises and dropped calls. Although VoIP equipment and hardware should be places as close as possible to each other, ATA should not be placed near the broadband internet router. The audio quality can be decreased if they are placed too close together.


5. Computer Maintenance and Hardware


There are a variety of different things that can affect the quality of your VoIP service. Therefore, computer maintenance is extremely vital in improving the service’s quality. Make sure that you de-fragment your computer on a regular bases. As well, make sure that you have sufficient memory for the computer and high quality microphone and speakers.


6. VoIP Phone Type/Frequency


The type of phone you have, as well as the frequency can affect the quality of your VoIP. Many people believe that the higher a phone’s frequency is, the better the quality of VoIP. But, in some instances, a lower frequency phone may fit your connection better. You may want to try a phone with a lower frequency if you are experiencing a lot of audio feedback.


Overall, VoIP is a fantastic low cost alternative for communication. VoIP are not passing through, they are here to stay. Major corporations have done some significant research to fix the disadvantages of VoIP service, as well as improve the overall quality. With all of the improvements continually going on with VoIP, it will soon be accepted by everyone as an acceptable alternative to PSTN.

Kevin Sinclair is the publisher and editor of Be Successful News, a site that provides information and articles on how to succeed in your own home or small business.


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