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Micah Singer says that the first week he started in telecom, someone handed him “The International CallBack Book,” by yours truly, and told him to read it. He somehow managed to survive that experience and has gone on to a series of ventures in the telecom business – dial around, wholesale minutes, VoIP, hosted solutions - but always near the epicenter of prepaid. Today, he is the CEO of a VoIP company, VoIP Logic, that hosts platforms for telecom service providers. There have been dramatic changes since the days of callback in the 1990s, but opportunities for prepaid services are still available for those who can find a market and create products for it. Singer gives us his take on prepaid telecom services and how VoIP figures into the picture.
GR: How many of your customers are providing some form of, what do we call it? Not prepaid VoIP?
MS:VoIP goes almost without saying. You wouldn’t say ‘prepaid TDM.’ VoIP is less sexy now, but there’s more and more of it every day at the core.
GR: <laughs> I never heard of a consumer headed into a C-Store to buy ‘some VoIP.’
MS:Maybe, ‘I’m going to buy some Telecom Classic, like Coke Classic.’
GR: What kind of VoIP services have a prepaid angle?
MS:It is interesting. Five or six years ago, there was a lot of talk of how rapidly the prepaid calling market was growing. In the last three or four years, a lot of the conversation, and I’m sure a lot of the revenue, has shifted to prepaid wireless. There are still calling card markets there, but they pale in comparison to the possibilities of wireless.
GR: So, what are the keys to making a go of it?
MS:I would say it’s like a lot of areas of voice communications; it’s about bundling, packaging things together. We have a customer called Red Pocket Mobile. Josh Gordon, the president, is a real internationalist. He realized the viability of ethnic markets in the U.S., just like for calling cards. It’s obvious that MVNOs are going after them, but he needed to offer something a little more unique than just cool Chinese lettering on his cards.
GR: What did he do?
MS:First, he went to Motorola handsets using Chinese character sets. You could text in Chinese, and all the menus were in Chinese. I actually have one of his phones around here, but once I put it into Chinese, I can never get it back to English. He started selling through agents and distributors in ethnic Chinese communities in big cities. What he bundled in was DIDs, Chinese DIDs, using VoIP. You have a SIM, and associated with that SIM is a US DID and a DID in Beijing or Shanghai or wherever you want in China. That allows family and acquaintances to call you as a local call in China.
GR: Not a bad idea. Are there any other services bundled in?
MS:We’ve seen VoIP as a driver in lowering the cost of calls to certain international destinations, including China. So, from that mobile phone with that SIM you have from his company, you can call your friend in New York, or your friend in Shanghai, and the cost is the same.
GR: How is this sold? In a card?
MS:It’s on a card, through distributors, shops and retail locations that cater to Chinese speaking populations. If you went to some of the neighborhoods in New York, San Francisco and LA, you will find that he’s in hundreds of different locations. Now, he is in more locations in China, because it is a great card for Chinese people traveling to the U.S. They put the SIM in their phone when they get here, and they have a Chinese number and a U.S. number.
GR: And, he uses VoIP to do this, right?
MS:Yes, he uses VoIP technology to manage the DIDs and the calls that don’t go on the mobile network. He’s innovating, using two prepaid models. There was a time in the market where investors were hot for MVNOs, and then that completely dried up, and then the spectacular failures that lost a lot of money. His model has continued to attract some interest. This is bundling, a word that has been around since the Telecom Act of ’96. It was all about bundling.
GR: And, VoIP empowers bundling, right?
MS:He could probably do what he is doing without VoIP, but the ease of integration has been facilitated by new technology that just happens to be VoIP, but these are VoIP systems. That’s what we are most excited about; we are a managed service provider, so if our customers aren’t successful, then they spend less money with us. So, we are really excited about innovative business models that have a lot of growth in them, so we get to see a lot of that growth.
GR: What other cool VoIP applications have you seen?
MS:There is a company named Phad that is a free long distance service. It’s audio ads that support free calls. One of our other customers, VooDooVox, is providing the revenue stream to Phad. Getting ads yourself seemed like a really tough way to do it, but there are ubiquitous networks, like VoIP. In this case, Phad is generating the calls and VooDooVox is generating the ads. What’s improved from the old ad supported models is that getting the ads is free to Phad. They get paid for playing the ads, and never have to hire a salesperson to sell the ads.
GR: How do you see the potential for prepaid services using VoIP?
MS:To be realistic, it remains to be seen what the real opportunity is. But, I think that based on the fact that prepaid is a model that people really seem to like for voice communications, and more and more for data communications, both of those translate into VoIP. So, it seems like VoIP is going to make its way to your handset, one way or the other. That might shift the entire paradigm so those prepaid mobile revenues might be called prepaid mobile VoIP one day. VoIP will be in the equation in the larger picture of prepaid VoIP.
Micah Singer is CEO of VoIP Logic. Visit VoIP Logic online at www.voiplogic.com. |
