Pulver's Purple Prophesies--And Fallout Thereof
Once upon a time, there was
a guy who railed against the incumbent carriers and wore a lot of purple.
Back in 2002, he railed against the generic "black and white" minutes of
glorified POTS traffic converted to VoIP.
Long-distance arbitrage was the name of the game, where service
providers squeezed as many pennies as they could shuffling calls from Taipei to San
Jose and from Mumbai to NYC.
Jeff Pulver watched as the wave of first generation VoIP shuffling happened and was disappointed at the results. After that came the initial moves to put VoIP applications on mobile phones and, yes, another arbitrage play to deliver cheaper phone calls through VoIP. Not much else.
Pulver wanted purple minutes, minutes of IP traffic part of an enhanced application that might include voice, data and video content. Six years later, Jeff is still looking for his honest purple minutes and innovative applications. Voice 2.0 is here, but there's been no big killer application, it's all just variations of a theme for call forwarding and voice mail and some APIs to slap voice into a web service.
As Jeff searches for some companies to invest in for the Next Big Thing, it's easy to see some of the fallout from the many, many me-too ventures selling black and white minutes without a lot of large-scale variation. Vonage is now pinning its hopes on reselling Covad DSL. TalkPlus and Jangl will, at best, be bought up. There's bound to be a few more mergers and implosions by the end of the year as VC cash tightens up.
Maybe the current generation of telecom leadership is too hidebound to really make change. Certainly I see the evidence in the lack of adoption for HD voice. I have to use separate programs to manage phone numbers and load the resulting contact list onto my cell phone. I can't even share phone number between my cell phone and my home phone because the home phone is essentially the same handset that's been around for 20-plus years except it has some memory and an LCD screen for caller ID. Gaak!
I hope Jeff finds a couple of radicals to overthrow the status quo before I throw my handset out the window.
- Doug
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Comments
By KenLex | Posted 11:18am | May 15, 2008
Too bad about poor Jeff and his purple minutes. But why should telecom execs rush (or even crawl...) towards HD voice when today's generation has come to believe that the voice impairments that come with CDMA or GSM or even a lot of VoIP services are just fine, thank you? No one's dialing 1-800-PIN-DROP to obtain higher quality voice service anymore.
Case in point: My teenage son grunts his monosyllabic responses to me on his handset and I understand them even less well than I do when he grunts to me in person; not being familiar with information theory, he fails to realize that in the face of impairments, he needs to provide me with more bits of information at the source. But oh, well, I'm just an old-fashioned telecom guy, I guess. OK for him, but not for me... or for the advocates of purple minutes.
By Michael Yokitis | Posted 9:37pm | May 20, 2008
I agree, Doug. Unfortunately for many of the bleeding-edge VoIP providers, their investors, and the media who cover them, however, is the simple fact that the market for Pulver's "Purple Minutes" has failed to materialize in a mass-market sense. It's not for lack of trying. Over the past few years many companies have brought innovative concepts to market. And almost all service providers have tried to create value-added revenue streams from IP-enabled features. After all, who really wants to race to the bottom? Who wouldn't want additional ARPU? But I believe that the market has spoken over the past few years, and it has said that people (by and large) know what they want in their voice service, and they don't want to pay for new concepts. Bottom-line, the mass-market has voted with it's collective wallet that it wants cheap LD, Caller ID, and Voice Mail. And the voice service doesn't even have to sound great. It's no wonder why the excitement has disappeared from the VoIP space. And that's why the Telcos and Cablecos still dominate the voice telecom marketplace.
By Aswath | Posted 3:37am | May 21, 2008
Jeff's slip in callng for purple "minutes" (which he later corrected it to purple "applications") is very telling. The whole industry is still fixated on a service provider model. The answer lies in appliance model. Yes you should be throwing out your handset and demand for a new kind of handset. or write about what one can do with devices like Verizon's hub phone, even if it works only in their network. If such devices get much wider recognition, then other consumer electonics companies will copy that.
By doug | Posted 2:49pm | May 22, 2008
I have some hope that Casabirt-based services will disrupt the status quo moving forward. But this is likely to be a slow-march akin to the "Year of the CD ROM"...which happened for 7 years.
Phone companies (Hi Mike!) will have to start trying ways to bring back the wayward souls that abandon them for cheaper (cable triple play) prices and independent VoIP services. Unfortunately, the same incumbents take too long to get new services to the market.