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Mashable Telco's

I had the opportunity to meet with Covad's Eric Weiss and Simon McIver here at Etel. They outlined a very broad and aggressive strategy to go after the small and medium business telephony buyer.  Beginning with a comprehensive hosted VoIP service, the foundation of which was their Go-Beam acquisition in 2003, they've built a series of services targeted at this market from the simple (find-me/follow-me) to the more complex (ACD's, conference bridging).  All bound together with a dashboard, customers can pick and choose their services to suit their needs.

Covad's heritage, of course, is broadband. They began with DSL, and have expanded to inexpensive T1, and wireless broadband.   Riding on the back of their broadband acquisition strategy, Covad's customers can now buy a bundle of communications services, and ultimately will be able to buy a complete bundle of business applications, including services like CRM and ERP… not just telephony.  Clearly they understand that applications are going to win the day, and want to get there as quickly as possible.

It could be a tough, uphill climb.  Their strategy is not substantially different from any incumbent's strategy, which puts them in the unfortunate position of having to battle AT&T et al, who are all bringing similar offerings to market and have a similar vision.

What could they do?  Well, here at Etel there is an answer.  Mashups.  The Mashup Contest (more on that later) provided a glimpse of how businesses might be able to build innovative new applications with just a few additional APIs added to their service.  Moreover, there are some very interesting players offering mashable components.  StrikeIron, for instance, offers a series of building blocks accessible via web services for text message delivery, reverse lookup, DUN and Bradstreet lookups, and so on.  Over breakfast yesterday, they expressed their desire to add more services to their portfolio, as well!

In Kaliya Hamlin's talk on identity yesterday, she touched on the fact that carriers have customer databases, and billing assets.  Lee Dryburgh and I talked about the same thing a little later.  If Covad were to exploit those assets by opening their network to third party developers, flowing through billing to the developer, that would be a match made in heaven.  A wealth of new, revenue generating applications, delivered via an ecosystem of third parties.

And nobody has done this yet.  AIM Phoneline got partway there, with their web services APIs for developers, but did not provide the unified billing relationship.  SIPPhone allows network to network interoperability, but does not provide the platform level call control that would be required.  Pulver's venerable FWD provided platform level call control, and network interop, but no mechanism to monetize the services.

Nobody has delivered a mashable telco. 

If I were a VC, that's a bet I would take.  And if I were Covad, and I thought that apps were the future, that's where I would start. 

Covad needs to mash.

{ 4 comments… add one }

  • Markus Goebel March 2, 2007, 3:48 am

    I agree that there is still more mashup to come and I am quite happy with Gizmo 3.0 that connects IM and phone for me. Also Gizmo Call that lets people make free phone calls to me from a website. At the end of all mashups telephony will be free and no billing needed. I am alreday trying to implement as much of it at home. I just got a Peruvian VoIP phone number for my office in Berlin, so that my friends in Lima can call me for local prices. If they had ENUM they could call me for free. Maybe ENUM is the key to all those mashups. But until now nearly nobody uses it, exept of me and some others.

  • Tim Panton March 2, 2007, 7:07 am

    From what I saw at Etel, it looks like there will be a couple of mashable Telcos. BT announced a beta for their API which allows origination and conferencing from a webapp, you'd need to put a thin serverside layer in
    before you could hit it from AJAX, but still it is a good start.

  • Alec March 2, 2007, 7:46 am

    Hey Tim, i saw the BT stuff too a few hours after I put this up. Very cool.


  • Fred Welsh March 17, 2007, 4:51 pm

    Interesting read, mashable components are probably the only way starving internet businesses can survive in the extremely competitive market of internet services, with big names such as Verizon.

    T1 Service

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