VoIP

Sure, it's a Free Phone, But Will it Sell?

The free ISPs found that a million people using a free service was no business at all. But one VoIP startup says this time, it's different.

by Alex Goldman ISP-Planet Managing Editor [November 2, 2004]

A phone that's purely software can be given away for free. That's certainly the case with Skype's popular service, which topped ISP-Planet's first VoIP rankings ever published, with 9.5 million subscribers worldwide.

But after publication, we received a note from Fort Lauderdale, Fla.-based voiceglo, whose glophone service claims 1.8 million subscribers. Prices start at free for PC to PC calls, rising to $19.95 for unlimited calls within the U.S. and Canada.

ISP-Planet introduced voiceglo to readers in the in-depth article, The Globe Does VoIP, published in May. At the time, the company was focused on delivering VoIP through ATAs, on the Vonage model.

But with the glophone, the company has embraced the Skype model of offering users a free phone. voiceglo hopes to upsell those users to paid services in the future, and is looking to ISPs as a valuable ally in the search for paying customers.

Kent Clothier, voiceglo senior vice president of sales and marketing, is somewhat disparaging of the ATA model now. "We've moved away from that model," he says. "It's a race to zero, in our opinion."

He sees a compelling combination of easier provisioning and lower costs in the glophone model. "What we like about the glophone is the ability to take advantage of the "wow!" factor of VoIP and to allow users to use it immediately. They just download the app and they're doing voice as long as the PC has a headset or speakers and mics." Basically, the idea is that most PCs already have all the hardware they need to use the glophone.

Although his company is frequently compared to Skype, Clothier says that's not the real competition. "The competition is the big phone companies. We need to look at the big picture here, and they will get into the business. It's just a matter of time. But we also embrace them as potential partners. We can compete with them and we can potentially work with them."

For the future, the company is working on a new feature, glomessager, that will blend VoIP and instant messaging. It allows the customer to click on a buddy list and send a message. In practice, Clothier says, it works like a Push To Talk radio or like Nextel's walkie talkie service.

The company is also actively encouraging end users to customize their software phones with skins. A wide variety are available at skins.glophone.com.

—End