Why Consumers Don’t Care About VoIP

Having been involved actively in the VoIP space for almost the past 10 years, I just wanted to share my take on a recent fact which shows how consumer VoIP is not taking off as expected. The news behind this statement is that AT&T decided to close down their VoIP service CallVantage and it seems that Verizon is very close to take a similar decision.

It’s a shame that a service like CallVantage will be shut down, even worse if we take a look at the money spent to make it widely known:

CallVantage is now in 170 U.S. markets and is backed by a multimillion-dollar nationwide advertising campaign. At $35 per month (after a $20 introductory rate), CallVantage is one of the more expensive VoIP services on the market, and while AT&T believes its reputation and quality of service helps justify that price, the carrier isn’t daft — its brand name can take it only so far.

First of all, I learned that when you talk to a “normal” user, the usage or, worse, the abuse of the word VoIP could be misleading and most of the times it leads to confusion rather than advantages.

A “normal” user (average knowledge of telephony and internet)  who hears the acronym VoIP will likely ask “like Skype? Do I need a PC?”. Even worse, my 65 years old uncle who worked in a grocery store for the past 40 years who doesn’t have an internet connection at home would ask “VoIP what? What’s that?”. This just to say that if you had used the word “telephone”, “telephony” or “telecom operator”, those would have been more familiar to both types of customers.

That said, the perception of value is much different depending on the market segment you are talking to. And most people, in particular in tough times, look at their wallet carefully.

If you tell my 15 years old cousin that she can get unlimited calls from his phone at home, a personal phone number, ability to send instant messages to her best friends from her personal phone, she’ll be very happy, while if you’d tell the same to my uncle he would rather ask how much he pays for the calls and that he doesn’t really care of the “personal” phone number.

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Last but not least, another example. I used to have a 4Mb ADSL connection at home for the past two years. No telecom contract, since me and my wife both use our mobile phones intensely. The problem is that since we decided to spend most of the time in our house’s basement, we realized that the reception is very bad so we had to find a good alternative not to be isolated.

Very easy: I just called our ISP who sent me a new modem with an integrated ATA where I could plug a normal PSTN phone. They also upgraded my ADSL to 10Mb, and offered unlimited national calls plus a local phone number. All for just additional 9 euros per month. I know very well that this is a “shared access” solution and I’m now using a VoIP service, but my wife (a “normal” user, according to the definition above) doesn’t really care. I told her how the system works but she told me: “ok, does it work? It is enough for me!”.

Got it? “VoIP” could make sense when sending voice through an IP connection was just a game for geeks. Now the story is completely different and consumers need only to know what services they get and at what price. By the way: my provider didn’t advertise it as a “VoIP solution” but as a “Internet + Voice” bundle.

Conclusion

The market should be able to respond to users’ needs very quickly and everything around the mobile space is definitely #1 now. From this standpoint, services like Truphone, Rebtel, Jajah and others are definitely taking the right direction. At the same time, big operators should avoid big mistakes like those made by AT&T with the very expensive CallVantage advertising campaign. Give consumers more services, if they want them, otherwise give them a telephone to plug to your modem/router/whatever, but please don’t bother them with new acronyms and avoid making things more complex than what they could be. VoIP, at the end of the day, is just all about a telephone.

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