Live Blog of Voice 2.0 Panel at PTC

Jonathan Rosenberg, chief technology strategist at Skype; Rodrigue Ullens, Voxbone CEO; Frank Fawzi, IntelePeer CEO and Mke James, Metaswitch Networks director of systems engineering kick around "Voice 2.0."

Voice 2.0: Beyond the Hype: Lots of ways people are using voice today, let’s look at changes. Gary Kim moderating discussions from Rodrigue, Mike, Frank, and Jonathan.

Jonathan: Voice 2.0 (see yesterday’s talk): it’s not voice anymore, it’s video. Voice is becoming integrated with other media, part of a broader communications experience. As voice and video permeates the web, everything fits together as interactive content experience with seamless integration.

Frank: interactive video being woven into experience. We’ve seen significant interest by enterprise carriers to enrich end-user experience, trying to reach audience by any means possible (clicking links, sms, etc.). It’s critical that you deliver quality as part of business process. We’ve seen minutes double, 4.5B end of 2008 to about 10B annualized run rate now, coming from all kinds of customers, uses, and sources.

Mike: Traditional voice now dull and boring, now it’s about software and applications. Voice embedded in PC, more integration with TV. No one carrier is everything to everyone, need support for 3rd parties to develop.

Rodrigue: Internet-based company with Internet-based business model, voice as part of it. Not a fight between AT&T and Google, is an ecosystem of business models in global market. Enterprises are next opportunity (IT direct, management and apps), mentality of using certain apps is going to change. Telcos can afford their business model is by staff and host switching, engineers, need to embrace new opportunities.

Gary: What strikes me about this panel is that panelists will benefit from creative applications and capability. This is clearly a good thing. What advice would you offer others in the ecosystem? No way to fight this, many new ways to drive revenue. Frank: We talk with carriers about opportunities to reach their end users, deal with hundreds of millions of phone number in their registry. How do you think about creating opportunities to expand embedded voice, lower cost of communications, increase applicability of voice in new ways? Expansion and connectivity between voice and multimodal technologies? (15 times more likely to convert with human interaction).

Gary: Rich voice? Jonathan: what makes voice sales more effective is the real people. All this technology is about replicating face to face interactions. It’s not just the words, it’s the nuances, facial expression, the reasons we get on airplanes. Voice is lowest level, video is next step closer to experience of sitting next to each other. As quality gets higher, you get increasing value of return.

Gary: implications of infrastructure with regard to partners? Mike: Sometimes we need to get out of the way and allow the end points to negotiate.

Gary: voice has always been cloud-based, but now there’s more to the cloud. Frank: communications as a service, using (common) links to access cloud. Slight distinction: now all we need to do is enable an IP pipe. Jonathan: leveraging the IP model, worldwide network model. Allows new service providers to offer new services. Voice was regional, now you can reach anywhere in the world. Rodrigue: one of the ways of providing voice over other apps: use hardware, open source, infrastructure where costs are declining and redundancy is scalable. Mike: agreeing, legacy connectivity enables… Rodrigue: lots of affordable solutions available today. Jonathan: a lot of cloud service providers develop locally, value is in software.

Question: What drives this Voice 2.0 development? Suggested application stores, is there community and/or clearinghouse function, who is gatekeeper? Jonathan: There is no one answer. One interesting area is the web and different web apps, distribution channel is the browser. Other: mobile apps, e.g., iPhone and Apple App store. Frank: types of folks that we work with, we’re not opening an app store, working with communities of interest who may want to add voice as a feature to enrich their end user experience. Mike: many models of distribution including the web, branded carriers and app stores; other carriers distribute through their own channels.

Gary: regarding voice as an app: abilty of smartest guys to be surprised. For example, Apple may not have expected App Store to be as big as they are. Now others are building app stores. Rodrigue: takes several months or years to create new products, while on the web you can launch, analyze, relaunch. Innovation can be brought online on behalf of their users.

Gary: executives express concern about protecting their brand. How to make use of developer community? Jonathan: on the web, if you want to see how things work, try it, collect results, improve or add new features. That new model of massive “learn as you go” is a hallmark of success of the web. Voice 2.0 is about embracing the benefits of the web, contrast with traditional telecom models (long time to roll out new features, compared to adding IM to Facebook).

Gary: US telecom industry replaced 50% of their revenue model in the 1990s. I’m calling for them to replace 50% over next 10 years. (You’ve done it.) Jonathan: it comes down to embracing the developers, doesn’t give up value to user. Windows: huge group of 3rd party developers. Devices and networks open up, carriers become portals, to become operating system of voice 2.0. Frank: wireline revenue disappeared, new technologies can displace existing revenue models. Wireless can help, uses for voice increase abundance of opportunities (scalable networks).

Question: Future of mobile environment: Jonathan: hoping for open environment where providers like us can add value-added services. It’s one of the next frontiers: getting quality up is a big challenge and growth opportunity.

Gary: experience is limited where networks are not robust (really cooking). Jonathan: capacity changes the equation.

Question: how do you tackle voice 2.0, what are trends? Rodrigue: identifier (phone number) from voice calls enable new innovation. Jonathan: enterprises are seeing vast deployment in IP communications (video, presence, IM), but landlocked inside of enterprise. Need to create new generation of peering technologies, security, etc. Cisco just announced product that’s focused on this problem, using phone numbers as identifiers (VIPER), peering.

Joe Weinman: concern for stability, scalability and reliability (911 and safety-critical apps), what strategies for innovation of massive disruptions, dilemma of brand protection vs innovation? Frank: point where scalability, robustness and quality becomes critical, need to have a high quality services, how does that apply on telco level, how to you move a large organization into disruptive model without affecting customers, mission critical services, and existing revenue streams? It’s more challenging. Jonathan: questions that presumption: reliability can be obtained, available; data is more critical than voice link going down. IP pipe needs to be always up. Rodrigue: difference between telco and app provider: telco provides infrastructure, everything is redundant, critical lines. Have a different business, e.g. BT and Ribbit, play at another layer (other business units). Frank: you guys are providing the infrastructure, reliabilty from traditional means; disruption does not take away responsibility of network providers. Joe: Mixing apples and oranges. Access is a critical issue, but at application layer testing becomes a brand protection mechanism. Mike: in some places, telcos are tied by regulatory bodies, services like Skype do not replace 911. Frank: we’re all capable of creating opportunities for ourselves. Gary: would be interesting to do a study about when we think things will break, all critical apps are IP based. We rely on the connection, not our hardware or software that can be fixed by rebooting. Interesting what human beings are becoming accustomed to. Frank: we’re willing to accept certain things, like quality of wireless compared to wired.

Ifbyphone Buys Cloudvox to Support Development of New Apps

Ifbyphone, provider of Web-based  voice and phone applications especially for call center type applications, announced today that it has acquired Cloudvox to give its customers the tools they need to build their own open-source, customized phone applications to fit their business needs.

The deal gives Ifbyphone an open applictions programming interface it can use to provides Web developers (even less experienced ones) with all the pieces they need to build working Web-based telephony services.

At the same time, Ifbyphone will still equip them with the technology they need to deploy and scale their newly-built applications.

Developers can build web telephony services to work with any existing software, whether it uses Python, Ruby, PHP, Java, C# or HTTP. They can still build on all the features they need to control every phase of a call with only a few clicks of a mouse — and without adding any new equipment or infrastructure, Ifbyphone says.

The move is an example of the growing importance of end-user created and customer applications in the business and organization segment of the market.

Truphone Becomes a Mobile Service Provider

These days, any company that really wants to become a mobile service provider can do so. Recently Mitel, a provider fo business phone systems and solutions, became a mobile service provider to deliver turnkey communications solutions for its business customers.

Now Truphone has launched "Truphone Local Anywhere," allowing local mobile calling initially in the United States and the United Kingdom, using a subscriber information module (SIM) approach. Addtional markets, including European countries, Australia, Hong Kong and South Africa, will be added in 2010.

Initially, the service will be most valuable for U.K. mobile users who want to call the United States, but the service soon will extended across Europe and other markets U.K. callers may frequently wish to reach.

The new service offers mobile users local rates for voice, data and text services for all countries where Truphone establishes operations, all on a single SIM.

In conjunction with the launch of Truphone Local Anywhere, the company announced it has become a mobile virtual network operator in the United Kingdom.

Truphone Local Anywhere eliminates the need for users to swap SIM cards, juggle multiple mobile devices or use complex dial-back systems in efforts to avoid costly roaming charges.

Amazon Offers Authors, Publishers 70% of Revenues from Kindle Sales

Amazon.com has launched a new program allowing authors and publishers who use the Kindle Digital Text Platform to earn 70 percent of the revenue from each Kindle book they sell, net of delivery costs.

The new option does not replace the existing DTP standard royalty option and will be available on June 30, 2010.

Delivery costs will be based on file size and pricing will be $0.15 per MByte, Amazon says.  At today's median DTP file size of 368 KBytes, delivery costs would be less than $0.06 per unit sold.

This new program can thus enable authors and publishers to make more money on every sale. For example, on an $8.99 book an author would make $3.15 with the standard option, and $6.25 with the new 70 percent option.

"Today, authors often receive royalties in the range of 7 to 15 percent of the list price that publishers set for their physical books, or 25 percent of the net that publishers receive from retailers for their digital books," says Russ Grandinetti, Vice President of Kindle Content.

The new pricing shows, once again, how disruptive the Internet can be. This new plan will encourage more authors to "go direct" to Amazon, or at least force their publishers to sell ebooks at a substantial discount.

That will increase the pressure on traditional publishers to cut prices on wholesale Kindle books.

Amazon says the new program applies only to author or publisher-supplied list prices between $2.99 and $9.99. Why that price range? It creates a permanent and substantial pricing gap between Kindle-delivered content and a physical product delivering the same content. The list price must be at least 20 percent below the lowest physical list price for the physical book.

Publishers won't like that, but will have to get used to it.

The title is made available for sale in all geographies for which the author or publisher has rights, which similarly avoids the typical regional royalty deals, putting pressure on publishers worldwide.

Books must be offered at or below price parity with prices for the same content on other e-book readers or physical products.

This looks like a brilliant play from Amazon.  E-book prices need to (and should) drop substantially: When the cost of an incremental sale is near-zero, publishers have no business charging physical-book prices.

The traditional publishing industry obviously will have to deal with the reality of a new cost structure in the business, and that will have ramifications up and down the ecosystem. Margins will be lower, on a permanent basis, with all that implies for existing business arrangements.

On the other hand, the new policies could increase the volume of sales and certainly will create an opportunity for more niche publishing. It's just another example of how the Internet disrupts the economics of any business it touches.

33% of Users Will Post to Social Networking Sites Such as Twitter

The thing about social or online media is that people use media in different ways. In fact, even thinking about those ways has to be updated from time to time. Twitter and other social networks provide an example. Analysts at Forrester Research have for a couple years used the notion of "social technographics" to describe the different ways people interact with Web content.

Up to this point the focus has been Web sites and blogs. But now social networking is part of the model, as Forrester has added a new category, "conversationalists," to the framework. About a third of people will update their status information on a social networking site or post updates to Twitter.

That is more people than the 24 percent of people who actually publish a blog, for example, while 70 percent read them.

About 59 percent of people maintain a profile on a social networking site or visit social networking sites. About 37 percent post reviews or ratings, leave comments or contribute to online forums.

The analysis tries to describe ranges of online social media behavior, which has lots of people consuming content and relatively fewer creating it.

Conversationalists are 56 percent female, more than any other group in the framework.

Aside from the idea that people have different levels of involvement in the social media content creation process, the new category illustrates an important new feature of social media: the ability to create, sustain and promote conversations.

Skype Traffic Grows 63%

International long distance traffic growth has slowed, while Skype traffic is accelerating, says Stephan Beckert, TeleGeography strategy VP.

Over the past 25 years, international call volume from telephones has grown at a compounded annual rate of 15 percent. In the past two years, however, international telephone traffic annual growth has slowed to only eight percent. To be sure, growth rates always slow for any product or service that has attained high penetration, simply because any additional growth is compared to a larger base of existing users.

There have been some recession-related changes, though overall demand obviously has remained strong. Traffic to Mexico, the world’s largest calling destination, declined four percent in 2008, and aggregate traffic to Central America declined five percent, for example.

While international telephone traffic growth has slowed, Skype’s traffic has soared. Skype’s on-net international traffic (between two Skype users) grew 51 percent in 2008, and is projected to grow 63 percent in 2009, to 54 billion minutes.

"The volume of traffic routed via Skype is tremendous," said Beckert. "Skype is now the largest provider of cross border communications in the world, by far."

Is Net Neutrality a Case of "Feeling Good" Rather than "Doing Good"?

With typical wit, Andrew Orlowski at the U.K.-based "The Register" skewers "network neutrality" as a squishy, intellectually incoherent concept. It is so nebulous it can mean anything a person wants it to be, and often is posed as a simple matter of "goodness." Which makes people feel righteous, without having to noodle through the logical implications.

Yes, there often is a difference between feeling good, and doing good, and Orlowski wants to point that out.

"As a rule of thumb, advocating neutrality means giving your support to general goodness on the Internet, and opposing general badness," he says. "Therefore, supporting neutrality means you yourself are a good person, by reflection, and people who oppose neutrality are bad people."

"Because neutrality is anything you want it to be, you have an all-purpose morality firehose at your disposal," he says. "Just point it and shoot at baddies."

Beyond that, there are fundamental issues that seem hard to reconcile, because they are hard to reconcile. Consider the analogy to freedom of speech.

In the United States, at its founding, the right of free speech was said to belong to citizen "speakers," engaged in clearly political speech. Recently, the opposite view has been taken, that the right belongs to "hearers of speech." But that means there is tension: is it the creator of speech who is to be protected, or those who might, or might not, want to listen.

Does copyright protect creators of intellectual content, or those who might want to access it? Do property rights in real estate protect those who own property, or those who want to own it?

Network neutrality essentially poses similar issues, and they will not be easy to reconcile.