JAJAH moves to ad-funded model; Announces European partnerships

by alec on December 17, 2006

What do Google and MySpace have in common?  They’re both exemplars of the new media.  Having built hot online properties, they’re now turning to cross-over opportunities on television, radio and in print, in order to expand their advertising businesses. 

The market thinks they’re hot too, awarding them a much higher multiple than traditional media outlets.

Some of those established media companies are looking to fight back.  Tomorrow, two German companies (Pro7Sat1, Germany’s most popular TV station, and Bild-T Online, the most widely read newspaper in Europe), plus News Austria, the leading media company in Austria, will announce relationships with JAJAH.  Starting tomorrow, everyone living in Germany, or Austria, will be able to make free phone calls anywhere in their respective countries.  It’s the elimination of national calling charges for Germans and Austrians, and possibly the transformation of these companies into the new media properties they aspire to be.

Supported by a $5 million promotional campaign, the companies will include branded versions of the Jajah web application on their home pages, accompanied by advertising.  The deal expands JAJAH’s audience, supporting it with a well funded promotional campaign, and creates new web based advertising outlets for the three incumbent media players.  The holy grail, of course, would be contextually targeted advertising attached to a voice call.  They haven’t achieved that, yet, but it’s undoubtedly in the future.

For JAJAH, it’s also a shift in business model.  The “powered by JAJAH” sites they’ve partnered to build will provide them with a revenue split on the advertising dollars generated.   This is a free calling promotion, with a difference.  It has a plausible revenue model.

Ad funded voice was bound to happen sooner or later;  JAJAH has gotten there first.   Their progress will certainly be watched closely by other VoIP companies, like Italy’s Abbeynet, who already have partnerships with media players.

Now, if they can just close that rumored deal with Apple

Other links: Business 2.0′s Eric Shonfeld has posted an extensive interview with JAJAH Co-Founder Roman Scharf.  Pat Phelan asks how can they make money when their model is take people off the PC for calls, but present ads on the pC. 

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Free Telephony for Europe’s Largest Markets

JAJAH Partners with Media Companies to Provide Telephony Services and Infrastructure

MOUNTAIN VIEW, Calif. – December 18, 2006 — JAJAH unveiled this morning a new model for free telephony. By partnering with three of the largest European media companies — Pro7Sat1 GMBH, Bild-T Online GMBH, and News Austria — 110 million consumers will now be able to make free phone calls.

Pro7Sat1, Germany’s most popular TV station, will offer its customers free calls, conduct a primetime TV advertising campaign with JAJAH, and make free telephony an offer on its home page. Bild-T Online, Europe’s most widely-read newspaper, will bring a free telephony offer to its readership and market it in a similar manner. Finally, News Austria, the leading Austrian media company, will conduct a campaign in its local markets.

This news represents a business-model expansion for JAJAH and media companies. Founded as the people’s phone company, JAJAH seeks innovative ways to bring low cost or free calls to consumers globally. “We are really exited at the prospect of extending free calls in Europe’s largest market”, said JAJAH co-founder Daniel Mattes.

Starting today, anyone living in Germany or Austria will simply go to the easy to use web based application and dial anyone in their country for free. The offer arose from feedback from the JAJAH community in these countries.

The project represents the cooperation of telecommunications companies, media companies and an innovator. “We are seeing an interesting convergence here,” said Mr. Mattes. “The most innovative off-line media companies are moving towards the web. By working with JAJAH, our partners are able to deliver advanced 2.0 solutions to their existing customers. JAJAH gives them a path to the future by supplying all the telephony infrastructure they need”.

About JAJAH

JAJAH is an innovative and simple way to make cheap calls using the Internet – without headphones, microphones or software downloads. JAJAH connects users phone-to-phone, landline or mobile, local or anywhere else in the world. An Internet connection is only necessary to initiate or schedule the call.

JAJAH was introduced in the US in March 2006 and has since been awarded Top 100 innovating company by the reputed Red Herring Magazine.

It is the latest brainchild of founders Daniel Mattes and Roman Scharf. Simple and cost-effective: JAJAH opens up the benefits of VoIP to all Internet users—regardless of whether they have broadband or dial-up.

JAJAH is based in Mountain View, California with a European office in Luxembourg. Its board of directors includes Instant Messaging pioneer Yair Goldfinger, Haim Sadger of Sequoia Capital and Venky Ganesan of Globespan Capital.

{ 1 comment… read it below or add one }

Lal December 20, 2006 at 1:18 am

Thats Huge.
Good 4 Jahah; been watching them 4 awhile as they struggle with other similiar startups that pop up month by month. Final validation 4 them and looks like some real revenue.

Good 4 Pro7Sat1, Bild-T Online and News Austria as thats a leap of faith 4 them as well into the new unknown. Wonder how the telcos/carriers will respond which depends on how successful the campaign is with REAL users.

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