Sunday, July 06, 2008

Lessons from Ike's VOIP Research

Ike Elliott has surveyed about 10 VOIP Providers. (Many were invited but not many volunteered info). He has a chart detailing the QOS startegies here. Pure retail ITSP's in this list sell Internet bandwidth too - that helps to control the quality of service. The group of Hybrid Wholesale/Retail providers is the interesting group. As Ike explains here, "The main take-away from the chart is that all of the pure retail companies, led by CBeyond, are focused on selected cities or are focused regionally. That makes sense because it often takes a local sales presence for retail sales." The other take-away is that (except for which is a Level3 reseller), you have to choose between Wholesale or Retail because trying to do both is ineffective. It is 2 separate strategies. I know why they do it: to grow revenues and hit scale faster. But it rarely works out that way. Better to focus on one strategy and milk your own cows.

ISP-Planet has a review of yet another player, Alianza, that sells on features. Almost every VOIP Provider has a similar feature set. And since you can't tell the quality usually until after you are using the service, it comes down to price and sales. Without a sales force, it is a price driven sale - or you have some really good marketing tactics. As Alex Goldman writes, "It's tough to stand out if you're offering VoIP. You may have a good product, but so do many other companies."

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