The company behind MagicJack, magicJack VocalTec (NASDAQ:CALL, news, filings), is trying to shake up the voice marketplace again, this time from a different angle. They’re bringing “free” to the softswitch, application server, and session border controller marketplace, offering the technology behind their own network to anyone who signs up with their subsidiary YMax in a “Bill and Keep” relationship. The company isn’t pulling its punches either, they called out the competition by name:
VocalTec has invested in these products for many years to ensure it has the most robust, reliable and efficient systems in the world. The company believes its products are much more powerful than BroadSoft and Acme Packet’s per server.
Them’s fighting words, I’d say. YMax used to sell this stuff via its subsidiary Stratus Communications, but apparently they’ve decided to try a rather new direction.
VocalTec’s chief protagonist, CEO Daniel Borislow, has specialized in challenging the industry status quo, and this is no different. But what does VocalTec get out of this? Surely it isn’t really ‘free’? And which types of companies might be tempted? I’m not quite sure yet how it all fits together, but I will definitely be looking deeper. Anybody have any insights?
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Categories: Telecom Equipment · VoIP
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This is how it fits – Vocaltec owes money when they terminate calls to other company switches, and by offering a free servers and requiring “bill and keep” agreements, they will try to reduce the liabilities, disputes and lawsuits regarding switched access revenue.
The problem is that no telco has an incentive to enter into these agreements, as no telco is willing to incur costs of provisioning switches in order to forgo future revenues.
The indication is that the liabilities are overwhelming for Vocaltec, and they have trouble operating in the telecom world.
softswitch is a software that connects the one telephone line to another telephone line