There is a fundamental problem with the “VoIP is dead” debate continuing to rage across the VoIP/communications part of the blogosphere (see Alec Saunders part 1 and part 2, Jon Arnold, Andy Abramson, Ken Camp, Jeff Pulver part 1 and part 2, Om Malik, Shidan Gouran, Ted Wallingford, Dameon Welch-Abernathy (PhoneBoy), Rich Tehrani and a zillion others…)
Aswath Rao and Luca Filigheddu came closest to the mark in their posts. The fundamental problem with this entire debate is simply this:
Define “VoIP”?
As I discussed in an Emerging Tech Talk video podcast I put up this morning, there are a range of definitions you could give to “VoIP”, including, but not limited to, the following:
- The underlying infrastructure, a.k.a. the “plumbing” – the mechanisms, protocols, etc. that are used for the transport of voice/video/etc. over IP. Things like SIP, H.323, RTP, various codecs, etc.
- Consumer “PSTN line replacement” services – Offerings like those of Vonage and so many others where the basic idea is that you can get cheaper telephone charges by going over the Internet and getting rid of your local landline. Also called “pure play” VoIP by some or “VoIP arbitrage” by others.
- Computer-to-computer/softphone offerings, often coming from the IM space – Skype sets the bar here, but there’s a host of other players as well, including Gizmo, GoogleTalk, FWD, and many others. Some of these came from existing Instant Messaging services that simply added voice.
- Enterprise IP-PBX/”Unified Communications” solutions – Communications systems used by enterprises, large and small – what has traditionally been called the “PBX” but that term is increasingly meaningless given the range of options now being provided.
- The *entire* vision of rich communication over IP – The whole picture… everything over IP… voice, video, IM, presence, file/data sharing… the whole rich communication experience.
Each and every one of these is referred to as “VoIP” by some segment of our industry. (And there’s even more… I did have someone once reply to me that “VoIP” was the pre-paid calling cards that you can buy in convenience stores, etc. (And in truth, they usually do get their cheap rates by using VoIP for transport somewhere in there.))
The point is that we need to be a bit more precise in what we call “VoIP” before we can argue about whether it is alive or not.
From my point-of-view, the life and death of these different definitions of “VoIP” varies:
- The underlying infrastructure – Doing extremely well… in fact, so well, that it’s fading into the background and just being part of our underlying network infrastructure, both in the fixed and mobile environments. (Which also argues that some of the VoIP-infrastructure-specific products/services are no longer quite as necessary.)
- Consumer “PSTN line replacement” services – Great for cable companies; not so good for pure-plays – Looked at Vonage’s stock price lately? They and so many of the other companies whose only real selling point was “get cheaper phone calls with us” are certainly struggling or dying. Why? The cable companies, for one, are cleaning up in this space with their “triple-play” bundling of voice with Internet access and television. The pure-play companies may be cheaper on voice but the cable packages may be far more compelling. Add in the “unlimited calling” mobile phone plans we have here in North America, plus the softphone players like Skype plus some of the emerging cloud/hosted offerings… and all-in-all it’s not a pretty picture for Vonage and friends. (And this is really the VoIP “industry” to which Alec was referring.)
- Computer-to-computer/softphone offerings – Very alive – Skype is flirting with 15 million simultaneous online users and also reporting decent income, Gizmo is rolling out a Flash-based softphone to remove the need for a client, TringMe is providing widgets to various folks… and a whole range of others are growing. (While some players are shrinking here, too, of course.)
- Enterprise IP-PBX/”Unified Communications” solutions – Very alive – Basically every vendor supplying communications systems to enterprises are now doing so over IP. No one is selling traditional TDM PBXs anymore. Players in this space include the traditional telephony players like Nortel, Avaya, Siemens, Mitel, Alcatel-Lucent, along with newer entrants like the dominant Cisco, ShoreTel, Digium/Asterisk and then even newer entrants like Microsoft OCS and IBM Sametime.
- The *entire* vision of rich communication over IP – VERY alive! – In fact, I’d say that the next few years will be one of the most fascinating years in this space. We’re at this amazing intersection of insane amounts of local bandwidth and computing power, increasingly ubiquitous powerful mobile devices, and incredible power out “in the cloud”. All around us we are building the massive IP communications interconnect. It’s happening. At a glacial pace in some areas and at a crazy pace in others. We’re layering on applications and services. We’re making them available through simple APIs and mashups. We’re all collectively doing some pretty amazing things out there. It’s a great time to be in this space!
So how do you define VoIP?
If you think of “VoIP” as my #2, the “cheap telephony consumer services”, then sure, if you don’t consider the cable companies then than sector isn’t doing too well. If you define VoIP as one of the other definitions here, well, then in my view it is very much alive.
What do you think? How do you define “VoIP”?
P.S. If you’d like to join a number of us to discuss this topic, Sheryl Breuker and Ken Camp are hosting a conference call tonight at 9pm US Eastern / 6pm US Pacific. Join us… it should be fun. 🙂
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communications, telcom, telecom, telecommunications, telephony, unified communications, voice, voice applications, voip
Great post Dan!
Maybe I’m just silly, but I define VoIP as:
Voice. Over. IP.
That is, anything that transmits my voice over the Internet Protocol. Simple. Effective.
Everything else out there is just fluff by marketers and analysts.
It isn’t if VoIP is dead or not (it clearly is not). It is a question of relevance.
For every category you’ve created above, the question of TRANSPORT (how the voice travels from point a to point b) is meaningless… the end user DOES NOT CARE.
What do they care about? Price and quality. Why are people using VoIP in every category you’ve included? To reduce cost.
VoIP isn’t relevant because it is an enabling technology that has failed to deliver on any 2nd order benefit. What I mean is – tell me one thing we have with VoIP that we DID NOT HAVE before VoIP…
Tough isn’t it… and if you’ve been in the industry 20 years it is even harder because you’ll realize that even the things people THINK result from VoIP don’t. They existed on traditional telephony… they just have different economics now – so we are back to cost.
VoIP will be relevant (and fully “alive”) when we see 2nd order benefit applications that solve real problems that were impossible or impractical to solve using circuit based telephony.
The essential content of your posting is amazingly similar to my posting three days earlier http://aaytch.posterous.com/how-depressed-are-voips-vision
I have a hard time assigning any ordinary meaning to the notion that
VoIP might be “dead”. A rapidly increasing percentage of all voice
network traffic is now carried at least part of its journey over IP;
more and more, that segment extends all the way to at least one of the
endpoints. Since any quantitative measure indicates that VoIP is
getting bigger rather than smaller, “dead” clearly cannot mean that
VoIP is failing any volume-of-usage test. I think what most “VoIP is
dead” bloggers actually mean is that VoIP is no longer novel or
disruptive enough to blog about – dead as a blogging topic, not dead
as a technology or even as a business trend. After all, one can’t
make a big splash in the zeitgeist by announcing that some largely
invisible technology is replacing some other largely invisible
technology. If that’s true, then just what is it that did “die”?
Is what really died the notion of “Telco 2.0”? I have even more
trouble guessing what meaning anyone might have assigned to that
label. Perhaps it might help to understand what “Telco 1.0” was…
What was The Phone Company (or The Phone System? …for most of us in
the US at least there was little practical difference for a long
time)? What did it really do? What value did it provide in exchange
for the vast sums of money it extracted from us for so long? The two
obvious central items of value it provided were:
1) A connection between you and someone else over which your voice
could travel.
2) An address (your phone number) that anyone anywhere could use to
create that connection from themselves to you.
that’s quite an achievement if you stop to think about it – it took a
huge capital investment, great ingenuity, and plenty of plain old hard
work to create it and to keep it running for all those years. They
probably deserved at least most of that money we paid them.
But considering only those two things, one begins to understand why
the advent of the Internet and VoIP might lead to the expectation that
something really new (the hypothetical “Telco 2.0”?) might be just
around the bend. After all – doesn’t the Internet provide us with
both globall connectivity and addressing? What do we need a Phone
Company for if we’ve got an Internet connection and a URL? What could
be more novel and disruptive than the idea that we might no longer
need Ma Bell? The trouble is that there was one more subtle bit of
value that The Phone System was providing us all that time:
3) A set of constantly evolving standards to accomplish 1) and 2)
everywhere, year after year, across differences of language,
voltage levels, legal jurisdictions, microphone and speaker
efficiency, financial philosophies and in probably a zillion other
ways that none of us had to think about. It all “just worked”.
Why haven’t VoIP and “Telco 2.0” changed everything? Why do we still
have Phone Companies? Does the fact that we still have them mean that
VoIP is “dead”, or has somehow failed to fulfill some Utopian Promise
that we all thought the technology had made to us? Does the fact that
the new Internet Telephony providers seem to look a lot like much
smaller less well capitalized versions of The Phone Company mean that
they are not really different from what came before? Not at all — it
just means that the world changes more slowly and in more complex ways
than most of us appreciate (or need to) in most of our daily lives.
Maybe in ways that don’t meet the requisite level of novelty and
disruption for the new-idea-a-minute and everything-is-different-now
crowds.
The Internet can in fact provide items 1 and 2 (if you’re fortunate
enough to be where it’s available and can afford it), and eventually
the marketplace of ideas (and the hard work of many people) will
evolve some workable rules to stand in for 3, but that’s a lot harder
and slower than one might think, and to do it we have to find ways to
interoperate with everything that existed before the big-I Internet
came along to Change Everything.
Keep watching and listening… the world is getting newer all the time.