If you’re thinking about sound software right now, you’re way off. Instead I’m talking about the literal words. VOIP (Voice Over IP) is a really hot technology right now because it makes phone calls much cheaper than using traditional telephone service. I’ve pondered whether IP network use is cheaper than maintaining traditional phone networks, or if the telco’s were simply sticking it to everyone. Considering recent more aggressive pricing by the telco’s, I’d suspect it was the latter.
Perhaps the most famous of the VOIP services is Skype. It’s been gaining steadily in popularity for several reasons. First, it allows free calls between users. Because there is no service charge, big savings can be had. Second, the application to use the service is cross platform. Finally, the cost to call a regular phone or have a regular phone number attached to your account is very inexpensive. That’s built a rather rabid fan base.
That base can’t just like the service, they have to see it as numero uno. Witness Skype Journal’s latest rant against Vonage. Here’s the quick summary: Vonage’s business plan sucks. I guess the waiting to be bought out by eBay strategy is the way to go (witness the dot com bubble burst). Considering the title of the website, isn’t the analysis just a little biased? Maybe?
The big reason there hasn’t been a massive exodus to VOIP is that people don’t like change. The question you have to ask yourself is whether your grandmother could adapt easily. With Skype, that answer is a resounding no. Being tied to the computer sucks (headsets don’t really alleviate the situation). On the other hand, your grandmother is already familiar with the phone. This is where Vonage is going to stick it to Skype time and time again. Phones have become so ingrained in our culture that they’ve become transparent technology. That’s what gets the masses excited.
Another issue to the billing. Unlimited plans are still very popular, even in cases where metered may actually be much more cost effective. People will put up with the higher flat fee because with it comes peace of mind. It just feels good to know that you don’t need to monitor your own usage. People have had enough of that with traditional telcos.
Mom and Dad
I’ve been using Vonage as my phone service ever since I bought my townhouse. I’ve been so happy that I sold my parents on it. It was an easy sell for many reasons. However, the easiest way to grasp it is to look at it from my parents’ perspective.
- The equipment isn’t changing in the house. In that regard, nothing is changing.
- They get unlimited local and long distance.
- They get free caller ID, voicemail (with web access), and call forwarding to their cell phones.
- They get a portable device that lets them bring their phone with them anywhere.
- Their bill drops from $33/month to $25/month.
- They get to keep their phone number.
Compare that with Skype and it becomes abundantly clear why Skype isn’t a real phone replacement and why serious adoption is going to hover way out of their reach. It simply doesn’t offer the features that will ease the transition to VOIP. It’s more of a stark slap in the face that will appeal to few besides the young and the technophiles. Vonage has the right idea and it’s time Skype recognized, especially if they really want to assert market dominance.