With the likes of Vonage on the verge of extinction thanks to the pummeling they’ve received since the start of their operations, no one can dispute the impact cable companies have had on the VoIP industry over the last few years. But will 2009 bring a further tightening of their grip on the industry – or will single plays leverage their nimbleness in order to earn themselves a bit of breathing room?
Heck if I know for sure. Thankfully our next interview comes from the cable side of things – after all they are in the best position to answer those questions. Rafael Fonseca is VP of Market and Application Development for Cedar Point Communications, a company that enables cable companies to offer VoIP services thanks to their cable telephony solutions.
Rafael brings with him more then 20 years of system and architecture design to his task of identifying market needs and working with their cable and telecommunications industry customers deploying voice services. With that mission and level of access to cable companies, it makes for unique point of view on the near future of VoIP.
We’re going to skip the niceties and jump right in…
Rafael, from where you’re sitting what are the sector(s) that you think will take off or see tremendous growth in 2009?
Fused services for consumers will really begin to take off in ’09. We’ll see the simultaneous interplay of voice, video, data and multimedia applications. VoIP will serve as the foundation of the new services. For instance, consumers’ televisions will be a vehicle for managing their phone service (incoming and outgoing calls). If the phone rings during a football game, viewers will be able to see who it is right on their screen and determine whether to direct it to voicemail or answer it, even select the answering device. IPTV will also offer video conferencing capabilities direct from the home.
Damn. I just want more channels with better programming, but that is pretty tight. Who are the VoIP companies to watch over the next six to twelve months? Who will have the hottest products and or will be releasing the most innovative or game changing services?
Some of the companies to watch in 2009 will be the cable operators. They have made some significant inroads into residential VoIP, pushing the envelope on offering fused multimedia applications, and are beginning to make an aggressive push into the small and medium size business (SMB) market. Several of the large operators like Comcast and Charter and smaller operators like Bresnan, Buckeye and Metrocast will be true innovators in 2009. They will look to vendors like Cedar Point to cost effectively develop and deliver these fused services in a timely manner.
Examples are: enabling legacy phones to accept or generate text messages, triggering a point to multi-point conference call via your TV set to predefined users or telephones. Leverage presence to deliver advertising to voice end points, both fixed and mobile. Video conferencing and video messaging which leverages both the cable operators’ broadband connection to your home and the traditional CATV link for the TV.
Significant is an understatement. Tell me more about the residential and business market segments or verticals that are looking tasty for VoIP companies over the next six months to a year?
Business services will become a very important market for 2009 and beyond. The relative size of the market makes it difficult to ignore. Combine that with two factors; most small to medium sized businesses in the US like doctors’ offices, retail stores, and repair shops to name a few, pass within an existing footprint of a service provider; given the economic climate most small business will not want to incur the costs to own and manage their own voice network i.e. PBX, all contribute to make a hosted voice offering from a service provider very attractive.
On the consumer front what we’ll really begin to see over the next few months is how VoIP will become a part of Web applications. Where once messaging was really the prominent application, we’ll see voice become the more practical technology in applications like online-gaming and social networking.
It seems that hosted solutions are mentioned every time I ask that question. So – do you foresee any sizable shifts in the type of businesses that will be potentially migrating to VoIP in the next six months to a year? Are they the same as this year or will they be different?
As I mentioned earlier, more small business will adopt VoIP because of the cost savings. In fact, service providers and enterprise customers who have Cedar Point technology already have the infrastructure in place to accomplish this. Cedar Point’s SAFARI C³ Multimedia Switching System supports legacy circuit, NCS and SIP-based voice services, as well as a migration path to IMS.
You mentioned cost savings – some feel the VoIP industry will benefit from a recession since everyone will look for low cost alternatives – while others think the industry will feel pain thanks to delays in technology and infrastructure improvements until more certain times, what’s your take?
We fall in the first camp in that we believe that this will actually be a lever to speed up the adoption of VoIP. Small businesses will be looking to conserve cash and minimize operational expenses and will look to those service providers who can offer a cost effective hosted VoIP service. Similarly consumers will be looking to save money on their household “utilities” (voice services fall into that category) and moving to a VoIP offering from a service provider makes sense. In fact bundled offerings, including video and data are become extremely cost effective.
As previously mentioned, those service providers who have deployed Cedar Point’s SAFARI C3 already have the infrastructure in place to meet that demand from both business and residential customers. Their investment is protected.
Rafael – you know it is a bit of jungle out their right now. What advice you offer to companies in the VoIP industry for the next year? What are you doing to make sure that your company continues to grow?
Look to new markets such as the small to medium sized business as your growth engine. From all available market research this represents a significant opportunity. If you are a service provider, these high margin customers are right in your own backyard.
We, at Cedar Point Communications, will continue to invest in both new and existing product development that will service high-growth markets such residential voice services and small to medium business voice services market. In addition we have begun the push into defining, developing and deploying the next generation of fused multimedia services that both consumers and SMB’s will demand.
In addition we will be continuing our push into geographic markets such Latin America, Eastern Europe and Africa. Cedar Point is expanding its targeted customers to include telecommunications service providers along with our cable customers.
Let’s diverge. With the number of open source telephony platforms continuing to grow each month it seems – will open source telephony continue to grow in importance and prominence during 2009?
We, at Cedar Point Communications, believe that there will be a niche segment that will adopt open source telephone platforms for low end or secondary telephony applications or as a method to test a market or technology with little investment. The industry is reaching a level of comfort with VoIP as a valid “product” such that the need to “test” it as a product has passed. Subsequently most service providers will choose platforms which will allow them to be serious contenders in the VoIP space and will pass on an open source solution.
I see where you are coming from, but you better watch out for projects like FreeSWITCH.
Onto another hot topic – will 2009 finally be the year that Unified Communications see a big “adoption rate” increase?
We believe that UC is a component of the fusing of services and as such is a precursor to more interesting services. We partner with best of breed Unified Communications vendors as part of delivering an end to end solution. We continue to see interest from our customers and prospects for Unified Communications solutions.
Drop it like it’s hot…
VoIP is no longer just a service. It is becoming the foundation for anything voice. It serves as the underlying technology for services such as high-definition voice, services for the elderly and hard of hearing, voice and video interactions and intelligent call routing. It is also the foundation for the next generation of services where “fusion” of the current stove pipe applications will make for increased customer adoption and improve their satisfaction.