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Summary:

When BT, formerly known as British Telecom, splurged and bought Mountain View, Calif.,-based Ribbit for $105 million some 15 months ago, I dismissed it as an attempt by an aging incumbent carrier to reinvent itself as a web-savvy, next-generation communications provider that was unlikely to succeed. […]

When BT, formerly known as British Telecom, splurged and bought Mountain View, Calif.,-based Ribbit for $105 million some 15 months ago, I dismissed it as an attempt by an aging incumbent carrier to reinvent itself as a web-savvy, next-generation communications provider that was unlikely to succeed. “BT has always been long on promise, but short on execution of its grand vision,” I wrote.

Fast-forward to today and BT has fully embraced the new communications reality, one that goes beyond mere voice calls. And to show how serious it is, the company has made Ribbit founder Ted Griggs the chief technology officer of BT Voice.

When I caught up with him on the phone last week, I asked him about the bold move by BT to put someone like him in charge. To some insiders, that might seem like letting the inmates run the asylum, Griggs quipped. Ribbit, if you remember, was started about three years ago with the promise of bringing together web and voice using a new kind of a platform, one that was able to take inputs from different communication tools — XMPP, Skype, Yahoo Messenger, MSN and Flash Media Server –- and make them talk to their “switch.”

More Than Just Voice

JP Rangaswami, managing director of service design at BT who was recently named BT’s chief of digital communications, has championed Griggs’s ascension to his new role. Griggs has always believed that when it comes to service providers, thinking about communications as just voice doesn’t cut it, which is why Ribbit’s products merge traditional notions of communications with web applications and extend them. In other words, voice is viewed as just another API that can be used to enhance a user’s experience. Ribbit for Salesforce and Ribbit for Oracle are two examples of voice and the web coming together, said Griggs.

BT’s big bet is good news for like-minded startups such as TringMe and Twilio, which are also seeking that elusive pot of gold based on the voice-web marriage premise. Now might be their time. Why? Because the very notion of communications is changing. As Alec Saunders, CEO of iotum, writes:

Let’s instead change the conversation –- acknowledge that the carrier network is a platform, and that the carrier has a need for an application community, and begin the dialog between network partners and developers about the ability for those operators to help us get to market.

The New Dial Tone

Indeed, people are increasingly using different modes of communication, from Facebook to Skype to Twitter to SMS, and carriers need to embrace such a change. That means they need to offer new kinds of services, such as voice-to-text, asynchronous messaging, asymmetric voice and low-cost dialing.

In other words, carriers will have to stop thinking like resellers of boxes and more like software-based network operators. Juniper Networks CEO Kevin Johnson recently started talking about how the next evolution of the Internet is going to be less about router and switches and more about software. His company has made its money selling routers to operators, so he does have an idea as to how operators are thinking.

Carriers Do It Best

Large carriers have many things going for them: global infrastructure, deep pockets and the ability to sell to larger companies. Innovative VoIP startups, on the other hand, have the right ideas, but don’t have the footprint or the resources to grow, Griggs said. To that end, he added, “We are doing what we were doing at Ribbit at a much larger scale at BT.” Carriers provide the nuts and bolts including the software platform, and developers do the rest, he said. (Related post: Is There Money in Voice APIs?)

But again, in order to do that, carriers need to change their thinking –- much in the same way that Salesforce.com did with CRM, Skype with voice and Google with advertising. For BT, Ribbit is trying its best. Will it succeed? Let’s wait and see!

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  1. Om – first I want to thank you for continuing to provide excellent coverage on the voice space. I know you have plenty other at your disposal these days for subject matter (and that voice has at times seemed boring to some) yet in reporting on it you are helping people through an important paradigm. The paradigm being of going from being a network (old or new), to being an application/development opportunity, and as Alex said so well this week, an opportunity to address important business and consumer user needs. With this will come new sources of revenue.

    As for Ribbit, while I was always impressed with what they did, I too was skeptical of what BT could/would do with them. But a year+ later, I must say that Ribbit not only still gives off the energy of a disruptive startup, they continue to innovate in a direction that is moving the industry forward. For the moment at least they seem to be pulling out the ‘good’ of belonging to BT.

    I spent most of this week at the Broadsoft conference – which only served to increase my bullishness for voice (http://bit.ly/hzeA9) – and Ribbit was impressive to both those those attendees who already knew of them and to those who were seeing them for the first time. And in talking with their people, you could still sense that feeling that they believe they’re onto something.

    So yes,this is good news as you say as good news for companies like Twilio (and I would add Ifbyphone), not only for market validation/valuation but also for the opportunity to benefit from BT marketing muscle.

  2. the concept is really great. but after three years where is the product? there are a few very enterprise centric offering such as thou salesforce. but there was also supposed to be an offering called ‘amphibian’ which really was quite amazing as it would integrated all the voice IM service plus skype with SIP and PSTN. but this seems to have all but disappeared. what went wrong? a lot of developers worked hard developing innovative flash based telephony products hoping they would fit right in with amphibian, but since the consumer service was never released there work is just sitting on sidelines waiting to see if anything ever happens.

    is there still any plan for a service that anyone other than a developer can sign up for?

    1. I agree. we were trying to develop some stuff using Ribbit, but had a hard time getting any support or response from them.

      Thereafter, we decided to try out Tringme for integrating flash and it was fairly easy to do that. Tringme’s support was quite responsive and usage charges are fairly priced too.

      1. Tringme certainly seems to have an upper hand with both flash and voicePHP compared to anyone else ath this point.

      2. something that was promised by both tringme and ribbit that never got delivered was inter working with all the VoIM as well as skype plus SIP and PSTN. both companies claim to have developed the technology but after years have still not allowed even developers access. if the technology really works why not allow at least basic calls from the flash clients to MSN, yahoo and skype?

        i do agree though that tringme is for the most part much better/easier to work with.

      3. Agreed – support has not been as awesome as it should be and it should be super easy to develop on Ribbit. We are working on that. Pinky swear.

    2. Well, technically it has only been two years (launched December 2007), but yes – we have been heads down for the last year – working on *all* of our products and integrating with BT’s infrastructure. Amphibian still lives in private beta (now called Ribbit Mobile) with 10k+ folks tapping on it in both the US and UK. Lots of going on for sure, more updates to follow.

      1. will we be hearing more about amphibian(or ribbit mobile) in terms of how it allows all the VoIM services to be integrated? what i have read about ribbit mobile it sounds like a fancy voice mail system with transcriptions. the earlier amphibian press release spoke more of a sophisticated softswitch that allows users to pull together all there VoIM accounts plus skype, SIP and PSTN into one integrated service. will this integration become available for developer apps? as the developer platform sits now you can not even place calls to/from SIP using a flash phone application. it is strictly PSTN.

      2. Anon(ymous): Yes. You will be hearing more. Soon.

  3. how many outside developers do they actually have actively using their platform? it seems like all the technology they’re pushing for salesforce, mobile, etc. is built by the company, not developers on the platform. the story to linked to mentions Ribbit had 4,000 developers when they were acquired so why aren’t we hearing about Ribbit apps all over the place (that’s about the same size as the Skype developer community)

    1. one of the problems is that there is no signup except for developers. you can not get a user account except for sales force. not all developers want to sell/bill for phone calls directly; i believe many would like to add ‘value added’ services to ribbit subscribers. but there is no way to subscribe.

    2. We have a pretty good sized developer community (over 15k registered), though most of the apps *in production* on the Ribbit platform are all behind a firewall. We have been Flash/Flex based for the past two years so working with a lot with Ad agencies so you don’t hear of them in the standard developer communities. I think the interesting stat to have is the number of API calls being made on the Ribbit Platform, so will work on gathering that data and will send it along to Om.

      Our REST API is in beta and that opens it up to all languages – so expect you will start seeing a lot more public apps in the near future.

  4. ribbit mobile looks an awe full lot like google voice. since GV is free i wonder if anyone would be willing to pay for ribbit mobile?

  5. Ribbit has a great vision whereby the can use the BT carrier network and allow developer to use it as a platform and charge a Ribbit license fee. Ribbit needs to prove that this great vision is good for the entire value chain, not just BT / Ribbit, but also the developers. This will be hugely challenging b/c the enterprise software world is meeting the carrier network world. Neither of these two sides moves fast at anything.

    This business model approach does not require a great deal of adoption (not like a conumer adoption model), but just a handful or two of large enterprise SW players and carriers lining up with BT/Ribbit in between. That is also the rub, BT / Ribbit will be fighting other co’s for this market space,, including Apple’s iPhone and even Google Voice and other consumer co’s that want into the enterprise world. Also for Ribbit truly to create an exciting platform, they have to move beyond just serving voice. IP is IP and voice even if it generates the large majority of revenue is still pretty one-dimensional.

    AND if Ribbit want developers to develop cool applications on their BT/Ribbit platform, they have to SUPPORT them, and not ever justify poor support.

  6. Ribbit has a great vision whereby they can leverage the BT carrier network and allow developer to use it as a platform on one end and service enterprise software customer on the other end, and charge the developers a Ribbit license fee. Ribbit needs to prove that this great vision is good for the entire value chain, not just BT / Ribbit, but also the developers. This will be hugely challenging b/c the enterprise software world is meeting the carrier network world. Neither of these two sides moves fast at anything.

    This business model approach does not require a great deal of adoption (not like a conumer adoption model), but just a handful or two of large enterprise SW players and carriers lining up with BT/Ribbit in between. That is also the rub, BT / Ribbit will be fighting other co’s for this market space,, including Apple’s iPhone and even Google Voice and other consumer co’s that want into the enterprise world. Also for Ribbit truly to create an exciting platform, they have to move beyond just serving voice. IP is IP and voice even if it generates the large majority of revenue is still pretty one-dimensional.

    AND if Ribbit want developers to develop cool applications on their BT/Ribbit platform, they have to SUPPORT them, and not ever justify poor support.

    1. Jebb, the telephony market is a pretty big one, so think there is plenty of room for multiple players here, and I believe it will come down to who offers the best overall experience to developers, consumers, partners, etal (APIs, rates, access, support, etc.).

  7. Great commentary again Om.

    I wanted to pipe in from Twilio’s perspective.

    We believe that many successful technological transitions begin by bridging current technologies with new users and use-cases. Then, by opening up the doors to innovation, you can provide a smooth on-ramp for new uses we can’t imagine today.

    With that in mind, Twilio’s customers are building real-life, financially viable production applications today. Here are a few examples:

    Sony Music: http://bit.ly/4FQRyZ
    Middle Tennessee State University: http://bit.ly/MHCiE
    1-800-CLEANUP Recycling Hotline: http://bit.ly/1zt0V0
    Task.FM: http://bit.ly/Uv2IM
    Mobile Commons: http://bit.ly/2R2xjW
    Frito Lay: http://bit.ly/2oYBjO
    SendGrid: http://bit.ly/4tOrgP

    And more. You’ll see a mix of classic telephony use-cases, and some pretty amazing new media applications, both big and small companies alike. We’re constantly blown away by what people build when they’re empowered with the right tools.

    Love your coverage of the space, Om. Keep up the good work!

    -jeff
    Twilio.com

  8. Ribbit Mobile’s Launch Shows BT’s Strategy Isn’t Just All Talk Tuesday, November 3, 2009

    [...] the offering appears to be a worthy competitor to Google Voice, it also underscores BT’s larger strategy of merging its voice business with the Internet. BT acquired Ribbit in a $105 million deal last [...]

  9. My Dad Doesn’t Want to Talk to Me Anymore Monday, November 9, 2009

    [...] getting beyond merely providing the pipe in this multimodal world. Check out what BT is doing with its Ribbit acquisition, as an [...]

  10. Why Net Neutrality Is Important for Startups, Innovation – GigaOM Sunday, December 6, 2009

    [...] From a startup and innovators perspective, service providers need to exist and be profitable. They provide the last mile and global connectivity required by technology startups to operate at any level. They also buy products and services from those startups, and often deploy them at a scale unheard of in other end markets. Customers like that make startups attractive acquisition targets — often resulting in a nice return for a VC fund (see Reliance’s acquisition of Yipes or BT’s acquisition of Ribbit). [...]

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