Yahoo buys Dial Pad

63 Comments

A week ago, I asked the question: how serious is Yahoo about voice? It seems they are quite serious! Much of it might have to do with Brad Garlinghouse who according to Andy was one of the big guns at DialPad, and is bringing the VoIP religion to Yahoo.

Yahoo, like other IM providers might have been late to the VoIP party, but the company is quickly making up for lost time. Barely a month after launching its own VoIP enabled IM beta product, the company snapped up DialPad, a VoIP company that sells PC2PC and PC2Phone services to consumers. “What we saw in DialPad was quick way to add PC2Phone and inbound calls,” says Joanna Stevens, Yahoo’s VP of Corporate Communications. Yahoo will integrate Dialpad’s services with its new IM product.

Andy explains quite well, when he writes: Dialpad provides Yahoo immediately with a proven platform that delivers least cost routing, the Dialpad engine that routes international traffic and enables termination plus gives them the billing, OSS and capability to make a Pre-Paid offering that terminates and possibly originates PSTN calling. Clearly this means Yahoo is going after the international audience and is looking to go right after Skype.

Update#2: Yahoo confirmed the deal, declined to talk numbers and assured me that Yahoo’s broadband partners (read Bells) are well aware of its voice plans.
Update#1: Craig Walker just called and confirmed the deal.

Scoop: Did Yahoo just buy VoIP operator, DialPad? I guess the next last thing to Skype? The PR folks at Dialpad were in a meeting and were thrown in a tizzy when I rudely interrupted their deliberations. We cannot comment on this, please call our CEO, is what I was told. Everyone seems to be in a meeting, and I called Craig Walker, the CEO and was told he was in a meeting. I am told, Yahoo is busy gathering Dialpad employees with new employment offers.

63 Comments

Rob Palermo / Dave Sammarco

We both used Dial Pad when it first came available…OH…did we have problems…it blew up many times…but we kept using it till we had over an hour of use betweet ct. and ca.. We should have invested it it…we helped dial pad become part of ya hoo….enjoy..Dial Pad..we sure did…Rob P and Dave S.

Rob Palermo / Dave Sammarco

We both used Dial Pad when it first came available…OH…did we have problems…it blew up many times…but we kept using it till we had over an hour of use betweet ct. and ca.. We should have invested it it…we helped dial pad become part of ya hoo….enjoy..Dial Pad..we sure did…Rob P and Dave S.

Rob Palermo / Dave Sammarco

We both used Dial Pad when it first came available…OH…did we have problems…it blew up many times…but we kept using it till we had over an hour of use betweet ct. and ca.. We should have invested it it…we helped dial pad become part of ya hoo….enjoy..Dial Pad..we sure did…Rob P and Dave S.

Heavy DialPad User

The rhetorical question above was: “… how serious is Yahoo about VoiP?”

The answer is: “Not very.” Since they acquired DialPad the quality of service and the abilty to connect PC2Phone on Intl. calls has deteriorated significantly. Sometimes I have to dial 10 to 20 times to reach Brazil.

They were serious about BUYING a VoiP Company, not running one.

Jake

Any idea on the numbers?
What was Dialpads revenue like? Their margins? Profits/losses? Capitalization? Cash on hand?

How did Yahoo value them?

Aswath Rao

Yahoo Japan has been offering IP voice for more than 4 years now. There are some fundamental differences: that one is a pure arbitrage play and it is ATA based, requiring connection to PSTN. For example emergency calls go over PSTN.

I am missing the importance and excitment of this acquisition. Yahoo now will replace Net2Phone with Dialpad. A reseller service has been replaced by an in-house service. Other than that how will things change?

Jefe

Yahoo Japan’s been offering IP phone service for at least a year.

Thomas Hirsch

Yahoo! move appears to force RBOCs to stop stalling and enter VoIP full force, or face disasterous consequences in the near future. Further, if cable companies, such as Comcast, want to be major players in voice, they, too, had better act fast. It might be best for cable companies to unite, and offer the same VoIP service. And wVoIP adds an interesting, probably influential, dimension. Any predictions on what the telephone scene will be like a year from now?

Alex Rowland

Just another example of broadband providers descending into low-margin commodity hell. SBC et al know exactly what’s going on. I would say they’re just waiting for the right time to drop a load of cash on a few winners and roll the services into their own offering. The only problem with this plan is that Yahoo, MSFT, Google et al might beat them to it. Time to sh*t or get off the pot…

jeeves

Well they certainly have an installed base of IM users to provide this. Now, the question is who will provide Skype the portal experience? M’soft or Google? I have a feeling it is M’soft given Skype’s technology bias towards Windows CE environments. If Yaho now integrates news, media, and VOIP based IM chat into the messenger environment, it could be a winner.

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