Yuki: I'm here in Las Vegas with Jeff Pulver, a habitual entrepreneur who likes to start Internet communications companies. The best-known is the company that later became Vonage. He also started Free World Dialup, and he won a victory at the Federal Communications Commission recently when the agency decided not to regulate peer-to-peer communications services that don't connect with the traditional copper phone network.
VoIP is Voice over Internet protocol, which is Internet phone-calling to the layman. So Jeff, why is VoIP taking off now, and how much of it is the next Internet hype? For example, when will your Free World Dialup Internet phone service make money -- or is that even part of your expectation?
Audio with Jeff Pulver: The Post's Yuki Noguchi talks with Pulver about what he's hoping to see this year at CES.
Jeff: Well, in fact the advent of Free World Dialup got me to the point of starting yet a new company whose purpose is to monetize these commercial opportunities. Last year, LibreTel was launched, PulverInnovations was launched and FWD Communications was launched. This means that today we offer: virtual telephone numbers, hardware IP phones and a software application that blends together elements of instant messaging, VoIP, video and conferencing. All of these companies, today generate revenue ..... albeit not that much yet.
As for hype, it continues to exist, but what we will see in part is the realization of the vision as during 2005 both cable companies in the U.S. and the Bell companies all roll out their VoIP service offerings.
By the end of 2005, it will be the cable companies on a collective basis who will lead the U.S. VoIP subscriber base.
Yuki: A basic question: What's the appeal of VoIP for most consumers? And also, if what you say is true about the cable and Bell companies, then what is the future for tiny companies like yours? I mean, will the Bell companies eventually buy you? (And is that your hope, anyway?) Or, do you worry that they will somehow make it difficult for you to use their networks to deliver service?
Jeff: At the moment, the appeal for most consumers is cheaper prices.
But if all that gets delivered are the equivalent of replacement phone services and nothing more, than this is an opportunity missed. There is a generation of people who have graduated from high school since 1999 who are part of the "always on" generation. People who communicate using short messaging, IM and Voice, and whenever they go online it is like a high school reunion. The player(s) who recognize this and deliver services for this generation will be the real winners in this space ....I agree that start-ups similar to the ones I'm involved with will be under heavy pressure to find their niche for success (which I think we have) or otherwise will not be there in 2006. If the cable companies make things difficult because they prioritize their traffic over that of their Internet-based VOIP competitors, then my expectation is that this will not be tolerated in Washington. We are living at a time where we are seeing the effects of Moore's law on the communications industry. Innovation continues to evolve and devices are being introduced at places like CES which will bring more people into using Wi-Fi enabled VoIP both in public hotspots and within companies.
Yuki: What types of devices are you seeing here at this show that demonstrate new ways of Internet calling? If you could describe in simple terms how these things work, that would be great. Also, which ones are likely to become mainstream and which are niche products that only the savviest of techies will know how to operate?
Jeff: In the end, I believe it will be the technology of VoIP that will enable many new services that consumers will benefit from ..... but I don't think that the mass consumers should be focused so much on VoIP as a technology. This said, service providers of today have started to bundle various devices, ranging from Wi-Fi enabled IP phones, to hardware IP phones to telephone adaptors connected to home routers and software applications on PCs and PDAs to help simplify the end user experience. These days voice really is just an application. I fully expect "voice" to be added to products in the home, as this technology has moved to silicon and it is possible to add voice capabilities to just about anything these days.
Yuki: You're also a poker player. You just said you wished VoIP stood for Voice over Internet poker. What are you playing tonight?
Jeff: I hope to play the high stakes table at the Bellagio and catch up with some old friends. At our last Voice on the Net conference we started a tradition of mixing VOIP with poker and have started to host our own charity poker events at my conferences to help raise money for diabetes research. This has started to fuel a full-time obsession with poker, and I hope to join the poker tour later this year. I will be playing in the World Series of Poker in July here in Las Vegas.
Yuki: Thanks so much for your time, Jeff. Good luck tonight. I get a cut of your winnings, right?