The impact of cloud VoIP services

Historically, business telecommunications has been a highly exclusive club of well-financed service providers who have been highly dependent upon business models that are pegged to over-subscription, product bundling and oligopolistic market control.

Telecommunications infrastructure has been a world of very expensive, highly proprietary equipment and telecom applications such as voicemail, conferencing, three-way calling and caller ID have been developed exclusively within the doors of the large service providers who intended to put them in the market.

The nearly simultaneous advent of open telecommunications software platforms (and their expansive feature-sets), server virtualisation, ubiquitous and affordable high speed Internet access and cloud network architectures has created a unique moment in time for the telecommunications industry and one could argue that this business will never be the same.

A scant five years ago, a business shopping for telecommunications products or services would have only a handful of options. Analog lines or a PRI connected to a proprietary PBX and either a best efforts Internet connection such as DSL or one or more T1s of Internet access.

Today, a business with an Internet connection of acceptable speed and quality can select from a wide array of cloud-based telecommunications services sized exactly to their needs. These services bring new capabilities at an affordable price and are powered in no small part by open source technologies deployed in the cloud by an army of upstart service providers exploiting these new technological opportunities.

The result: an “unbundling” of telecommunications services that provides the consumer choice, flexibility and functionality not available from the conventional telecommunications companies. Today, the availability of new infrastructure designs has accelerated the deployment of scalable open source communications frameworks. Increasingly, these tools are being utilised inside of large carrier and enterprise communications network for their cost-efficiency, scalability and flexibility.

The combination of the cloud and open source communications platforms has also birthed an exciting new application marketplace where creative new business models are being developed on a near daily basis. Companies that enable the underlying service of these applications (think ifbyphone, Twilio or Tropo) are acting as cloud “facilitators” for a new generation of applications being developed by both new business models and existing businesses that are developing their own telephony applications.

Many of these “telephony API suppliers” are powered under the hood by the same open source communications frameworks that are seeing increased adoption in recent years. None of these things were attainable by the average business five years ago and we have open telecom frameworks in the cloud to thank.

So what does all of this mean? Aside from the obvious benefits of choice, features and price reduction these technological advances place greater control in the hands of the consumer. A great example of this shift in control is the freedom made possible through Google’s free voice service.

By using Google Voice, you can separate your phone number from your provider’s control and arbitrarily move from one mobile or land line service provider to another without the need to port out or port in a phone number.

Additionally, the Google Voice service includes a bunch of free functionality such as voicemail transcription, dynamic call routing, in-call transfers, custom greetings, call blocking and web access to all of the above. Clearly, services like Google Voice are focused on empowering the user, not locking them into single provider and/or owning them.

Where consumers used to be lured to telecom companies by bundled product offerings and the promise of “savings” for buying everything in one place, the cloud now allows them the ability to save substantial amounts of money each month by purchasing their services over the Internet on an ad-hoc basis.

Toll-based products such as long distance and international calling have been disrupted by cloud services like Skype and Google Voice. As this market transformation has only just begun and the ways in which it will impact conventional telecommunications are not completely clear, it is safe to assume that cloud services will gain market share from the incumbents as the result of their capability, flexibility and affordability. The only uncertainty is how and when the conventional telecoms will respond.

Bryan Johns is the Community Director for Digium, the Asterisk company. In this role, Bryan works globally to foster growth and adoption of these technologies amongst developers, partners and commercial entities. Bryan manages a community around Asterisk and its associated technologies that numbers greater than 75,000 members. Prior to joining Digium, Bryan spent nearly 20 years in and around the businesses of technology and telecommunications. He has started, grown and sold a handful of web application development and VoIP technology businesses and in 2004, found a home in the disruptive world of open standards and open source telecommunications platforms. Bryan is a native of Atlanta, Georgia where he works when he's not out and about evangelising open source communications.