Richi Jennings

Ooma selling free phone service (and the original iPhone)

July 20, 2007 3:43 AM EDT

Free on Friday, it's IT Blogwatch in which we share the line on Ooma's promise of free phone service, with bonus celebrity spottings. Not to mention a phone with a built in etch-a-sketch...

Om got the briefing:
Voice over the Internet, so far, has been a game of cheap minutes, shoddy quality, and unreliable connections. It's also been a money-losing proposition. The promise of voice being free has remained just that - a promise. Palo Alto-based startup Ooma promises to resolve those frustrations in September 2007 while offering free voice calls for life.
So how does Ooma manage "free" voice calls? Say you call Manhattan. Ooma routes the call to an Ooma box to the 212 area code, with the local carrier accepting it as a regular outbound call. It works even if the destination number lacks an Ooma box
Think of it another way: What the PC did to the mainframe, Ooma is doing it to the telecom switch. It's a brilliant technological achievement, tempered by some serious regulatory and go-to-market challenges. These challenges are not simple. [read more]
Walt Mossberg answers the emergency question:
Ooma combines the VOIP and regular phone service. If you keep your standard phone service, Ooma uses your current phone number. And, if you dial 911, it always places that call over the traditional phone network. During an Internet outage, the device seamlessly switches to use the regular phone service, but you still pay no fees to Ooma.

If you do keep your standard service, you can reduce it to a very basic, low-cost plan, just for 911 and backup. International calls are routed through the Internet by Ooma and the company says they will cost roughly what Internet phone services like Skype charge for nonmember calls, which is well below traditional landline rates. [read more]
The Browser understands the system:
Launched by first-time entrepreneur Andrew Frame with a management and advisory team that includes Tivo CEO Mike Ramsay (TIVO), executives from Apple (AAPL), Yahoo (YHOO), and (somewhat inexplicably) Ashton Kutcher, Ooma promises to deliver on the true promise of VOIP: free phone calls.

In Frame's words, Ooma has "decentralized the termination architecture." What does that mean? Let's say you place a call from New York, on your regular old phone, to Palo Alto. The call goes out over the Internet and reaches the local 650 calling region. At that point, it hops onto an Ooma phone and makes a local call to the desired number, without disrupting the local caller's service. [read more]
Despite a deathwatch, Valleywag appreciates the beauties:
Launched late, Ooma's product, a piece of hardware that lets you place free phone calls over the Internet, looks set to flop, as insiders predicted, because its creators fundamentally misunderstand both consumers and technology. But at least the box, like Frame and Kutcher, is pretty. [read more]
Good Morning Silicon Valley has a spotting:
Ooma manages this by using a combination of peer-to-peer technology and normal phone lines that Om Malik says will do to the telephone switch what PCs did to the mainframe. Is this a game changer? Well, if the Ooma folks are as adept at technology as they are at PR (they've got actor Ashton Kutcher as their creative director, for cripe's sake), the box has a chance. [read more]
Cynthia Brumfield gets it out there:
Ashton Kutcher (yes, that Ashton Kutcher) is the "creative director" for the company ...

Ooma's sales proposition in a nutshell: buy a $399 device that delivers voice calls on a P2P basis and get free phone calls in the U.S. An optional device allows consumers to make free phone calls throughout the house.

Hello? Have these usually shrewd people suddenly become babes-in-the-woods? Vonage is about to go belly up, weakened not only by litigation but also slowing subscriber growth, Skype's usage is flattening out and SunRocket simply gave up the ghost last week. And those are the success stories in the third-party provider VoIP business. [read more]
Ken Camp spots a gnome, but no celebrities :
Ooma looks to be a poorly articulated, but highly funded, variation of PhoneGnome at best. An ill-conceived "me too" of technologies and ideas tried repeatedly at worst. There is nothing new here at all. Nothing innovative that I can see on the web site. [read more]
Podcasting News isn't impressed with Ooma and misses Ashton altogether:
VoIP is an important technology to follow for podcasters, because it offers a cheap or free way to do interviews with people anywhere in the world. However, at $400, Ooma looks more like an expensive way to share your phone line with strangers than a useful tool. [read more]
Rob Hyndman doesn't want to get robbed, oh - but ... :
Customers need to trust their telephone. But the Ooma model asks customers to spend the money - and take the big risk - upfront (US$400 in hardware), on a startup. Oh, and they're asking for that $400 from people they're trying to attract with the promise of low-cost telephone service.

Oh - but they do have a celebrity involved - Aston Kutcher - and the tech 'sphere is happy to cheerlead by reprinting their press releases [read more]

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Previously in IT Blogwatch

And finally... how phones might have been ...

Computerworld's online projects editor, Joyce Carpenter, compiled IT Blogwatch today. Regular Blogwatcher Richi Jennings will brb.