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Summary:

A Google executive claims the company is “just scratching the surface” with Google Voice and will move aggressively to expand the offering next year. Which means network operators must ramp up their efforts to make their pipes smarter.

Google is “just scratching the surface” with Google Voice, Bradley Horowitz, VP of Product Management, said today on eWeek.com, and will move aggressively next year to further blur the line between telephony and the Internet. And as the search giant turns voice into an application and dives deeper into carriers’ domain, network operators will have to find ways to leverage their networks and provide competing apps and services or be relegated to simply pushing other companies’ offerings through their pipes.

Google is gearing up to do battle with Cisco and Microsoft in the unified communications market. The company recently acquired Gizmo5, a SIP-based service provider, as part of its effort to build an enterprise-quality VoIP offering. And Gizmo5’s expertise in soft clients can help Google extend its mobile reach, potentially allowing the company to offer Google Voice across a host of devices.

As the recent acquisitions of Ribbit by BT and Jajah by O2/Telefonica demonstrate, voice is increasingly being turned into an application from service providers. Those acquisitions are aimed in part at helping users communicate from their phones in a variety of ways, from traditional telephony to Internet-based services like e-mail, instant messaging, VoIP and social networks.

But while savvy carriers are beginning to acquire startups to better compete in the brave new world of web-based communication, behemoths like Google, Microsoft and Cisco are coming at the market from an application point of view. Divorcing voice from the network is liberating for consumers who could enjoy a host of ways to communicate seamlessly and efficiently, but it also opens the field to non-operators. Operators that can leverage both the Internet and their own networks to deliver optimized, personalized services will be able to compete with the players moving into telecom. Those that don’t will quickly find themselves doing nothing but shipping data over their networks.

Image courtesy Flickr user danndalf.

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  1. Om,
    No doubt, anyone can be a phone company – that has been our line for the last 3 years and has really gained traction this last year.
    However I think the important part of your post is that voice is no longer about voice alone. The successful operators are those who are selling innovative business solutions where voice is just another aspect of communicating. Text, video, voice, web – the media is not important. What is important is how you apply them to real world solutions. Businesses will continue to pay dearly for solutions, vanilla voice however will be free, just like email is today. Thats where the money is!

  2. Yes, Google is trying to take over our business, but we will fight till the end :)

    Happy New Year all!

  3. Moshe, I agree. Its all about voice applications.

    Google is pretty far when it comes to serious businesses. Maybe, the SOHO kinds may like it but established and medium sized will shy away.

    Also, Google lacks automation.

    Originally, I looked at Google voice to interact with google calendar, email, logs, etc. The closest I have seen at IE Expo this year is Invox (www.invox.c) which won best of show there. It integrated with CRM, Email, Payment gateways, Calendar, Surveys, Database, REST, Skype integration, IM – all online stuff basically.

  4. Telco’s are not service providers they are distribution utilities, they are “dumb pipe” providers, but I don’t see anything wrong with that, they should embrace their essence. They have been stringing wires, installing and operating “big iron” switches. But they do not do software or develop services (thats left up to their equipment vendors).

    Some say that it telcos should buy up application companies but experience shows the cultures are too far apart and telcos usually end up writing off the acquisition after annoying away the talent.

    Telcos should instead offer up their networks in a fair and open access environment and let developers develop their applications on it.

  5. Mike,

    How do the telcos keep making the same ARPU if they turn over applications (voice, video, messaging,etc)to third parties? It is very convenient for people to say that they should just focus on being a “pipe” but they have already established the ARPU with those services and as public companies (with shareholders) they can’t give up the revenue. Show me the money to replace the services ARPU and you may see a Telco switch to a pipe provider or it will take a new company to the group (Clearwire) to provide the Silicon Valley with their dumb pipe nirvana.

  6. A common concern with all Google products is their indexing and storage of keywords to develop a profile on you, presumably for targeting advertising at you. It’s safe to assume that with Google Voice, they’re at the very least keyword scanning your voicemails and SMS messages sent through GV. I wouldn’t doubt if they are now, or plan on in the future, somehow using all that speech recognition data they gathered through the free Google-411 service to also keyword scan your actual phone calls.

    I think a lot of businesses that considered this intrusion into something we’ve long considered private, our phone calls and voicemails, to be a deal killer in using Goole Voice. It’s certainly stopped me from using my GV account until the smarter people than I more fully explore the potential privacy and security risks of trusting yet another intimate part of lives to feeding the great Google data mining effort.

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  9. A good read!
    Voice origination is certainly an exciting space with a lot happening in the last 6 months of 2009. I think 2010 will also bring more of the same as the Network Operators realise the ability to provide a software client can extend past a geographical boundary. With this a Network’s ability to reach a global population is realised. The addition of a software client provides the company an ability to value add and value up their very valuable customers.

    There is also realisable value in being able to ‘move to change.’ A software development house can give a large network operator an ability to respond to change quickly.

  10. I highly doubt that GV is a real telecom company. They do not offer any guarantee of service or any other advanced features. What makes me most mad, is that it’s not yet available in Canada. I’m sure once it becomes available in Canada, I’ll be using it as an extra to my phone line, but not as my primary phone number.

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