Vocaltec should turn its product into an open source project
It has been over 13 years since Vocaltec pioneered VoIP. And for most of those 13 years it has been unable to keep its head above the water. The company has just announced the departure of its existing CEO. Pioneers ought to be preserved like the British Royalty. I think the best way for Vocaltec to preserve itself is to follow the open source market trend. Few random thoughts below …
- Vocaltec product is the earliest VoIP product around. Vocaltec was first with several things: first PC-to-PC calling software, first PC-to-phone client, first media gateway, first gatekeeper (h.323). The company has plenty of VoIP experience. Developers will benefit a great deal from this platform.
- Most new generation VoIP companies offer services off the Web in a hosted fashion. Vocaltec product is supposed to be very good in terms of managing voice over public internet.
- Like some other open source solutions, Vocaltec can maintain a licensed version of its software in parallel
- What could the revenue model be? Well there could be a licensed version available as mentioned above. Vocaltec had hardware business as well which it shut down in December 2007. Lucent was the main OEM partner for that hardware. After Alcatel-Lucent merger the orders just stopped. Vocaltec could revive that business (or maybe acquire some other media gateway company – and there is some choice available). You could keep the hardware business and have that business unit become the corporate identity of the open source project. The structuring should be such that whoever acquires the open source project also acquires the hardware business (take a clue from the way Mark Spencer has structured Digium-Asterisk).
- No seriously, what could the revenue model be? You could in addition to above bring in the developers to a service provider you already serve and have some revenue sharing arrangement with either the developers or the service provider. Vocaltec has 70 carrier customers.
- There has already been one acquisition of open source VoIP project (Tekelec-SER, although Tekelec sells its proprietary version to carriers). There will be more acquisitions within the next two years. Vocaltec could be tapping a big opportunity here. Of course it all depends upon how friendly your APIs are. But Vocaltec has been trifling with standards for over a decade now.
- Cisco is the biggest share holder in Vocaltec. It currently owns about 23% of Vocaltec. So another option is Cisco buying the remaining share and then keeping this as open source. They did so with Vovida sometime back. That could be Cisco’s Voice 2.0 strategy, which the company lacks right now.
I have never really seen Vocaltec make big money. It has for most part been a loss making enterprise. It used its shareholding in ITXC to fund the business 10 years ago. Lately it has sold its patent portfolio to further fund the business. That deal is not concluded yet but how long is that money going to last? The company has been eating itself to death. There are not enough tier 2 and tier 3 players to sustain vendors like Vocaltec.
