When VoIP comes up in conversation, people often think of Vonage. To their credit, their recent television commercials show how they got on the ball and eased the user hassles of connecting. But there's a flip side to Vonage VoIP.

One of the real values of VoIP is the service convergence potential. Vonage has never leveraged that. I don't believe they've found their story to next generation unified communications yet. What the deliver is dial tone over an alternate path. That's not a bad thing, but when you think about the history of dial tone, it hasn't changed much in the past 100 years.

There have been big advances at points in time in the network. AT&T's implementation of direct long distance dialing was a significant change to users. That was an enabling change. Customers responded by making more calls. That's a good example of the "if you build it, they will come" paradigm in action.

Advances in carrier technologies, T-carrier in specific, helped advance the PSTN infrastructure from an analog network to a digital one, but the tangible benefits to customers were nested pretty deep. And while we've seen Caller ID, *69 call back and a few minor features, there really hasn't been any susbtantial change in dial tone service.

Dial tone is like water. When you turn on the tap, you get water. When you lift the receiver, you get dial tone. It's an expected commodity, not something innovative.

Verizon cuts VoIP charges to match Vonage
By Paul Taylor in new York
Published: May 3 2006 22:02 | Last updated: May 3 2006 22:02
Verizon Communications, the second-largest US telephone company, cut the cost of its VoiceWing broadband VoIP (voice over Internet Protocol) service which includes unlimited local and long distance calling by $5 to $24.95 a month – the same price as rival Vonage Holdings, the VoIP pioneer that recently filed for an initial public offering.

So in the news now, we see a legacy telco, a bastion outgrowth of the old Bell System, supporting the legacy. First, remember that Verizon was formed from Nynex and General Telephone (GTE), the largest independent telco of its day. And while VoiceWing is a VoIP service, if you read Verizon's press, here's what they say -

Where talk is cheap.

Chat away to your heart’s content with generous VoiceWing calling plans that offer local and long distance calling anywhere in the U.S., Puerto Rico, and Canada. VoiceWing phone service uses your broadband or cable Internet connection so you can access your phone wherever there is an Internet connection. Even on the other side of the country!

It looks a lot and sounds a lot like glorified dial tone. It doesn't sound like innovation. It doesn't sound like service convergence. It sounds like price competition on a commodity.


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