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Study Says: 8×8 is - apparently - the best

March 31st, 2005 | 2 Comments | Posted in Main Page

Believe it not, 8×8 Inc. is the “best VOIP provider”, according to a new study by TomsNetworking – topping rivals such as Voange, CallVantage and VoiceWing. 8×8 scored particularly high for “geographic service availability”. What I want to know is why there is a disconnect between what the study dug out and the sharp decline of 8×8 shares over the past four months. 8×8 may – or may not – have great service but it matters not if not enough people actually buy it.

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As the Nortel Turns

March 31st, 2005 | 1 Comment | Posted in Main Page

Another day, another U.S. executive being recruited into Nortel's virtual executive suites. This time, it's a new chief technology officer, Gary Kunis, who used to be Cisco's chief science officer. Nortel's current CTO, Brian McFadden gets bumped…er, I mean, receives a new assignment as chief research officer (whatever that means!). In the Canadian Football League, there are rules that stipulate a team must consist of a certain number of Canadians (known as non-imports) and non-Canadians (known as imports). There are slightly more non-imports on a team than imports to maintain the CFL's domestic flavor. Perhaps Nortel, Canada's flagship high-tech company, should adopt the same guidelines. Of the senior executives part of the new and improved management team (a.ka. the post-Frank Dunn regime), only two - CFO Peter Currie and McFadden - is a Canadian. What's with that, eh?!

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Vonage Launches LNP in Canada

March 31st, 2005 | 2 Comments | Posted in Main Page

After much speculation, Vonage is finally introducing local number portability in Canada. This should give Vonage another tool in convincing reluctant Canadian consumers to climb on the VOIP bandwagon. Another important development is Bell Canada’s willingness to offer “naked DSL”, which means Vonage customers do not have to have local and high-speed service from Bell to use Vonage. Vonage said customers can now transfer numbers from most major Canadian telephone companies in all 14 of its local service markets.
The big question is when demand for VOIP will pick up in Canada. While there has been lots of hype, there were less than 35K residential customers in 2004. This, of course, will like change this year as Bell, Rogers, Videotron, Shaw and Cogeco move into the VOIP market.
Another huge challenge facing Vonage and rivals such as Primus and AOL is penetrating multi-phone households. Vonage is great for a one-jack home but it is less than elegant if you want to use the phone jacks around the house. Vonage can either come up with an easy way to connect to home network, or it can do something like bundle multi-phone (two, three or four handsets?) cordless packages with its telephony service. Until this problem is addressed, there will be many, many households that Vonage and its peers will be unable to access from a primary line perspective.

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Grokster vs. IP

March 31st, 2005 | No Comments | Posted in Main Page

Newsday has a nice little opinion piece that should warm the heart of technology lovers. Newsday argues companies such as Grokster shouldn't be attacked by the movie and music industries because their technology provides a legitimate way for people to share information - even if people use it to steal movies and music. It's the classic “guns don't kill people, people kill people” argument. If the Supreme Court agrees with Newsday's position and, more important, the Sony Betamax decision, it will more pressure on the music and movie industries to meet consumer demand. So far, the music industry has failed miserably to solve the online puzzle. When Steve Jobs is the most innovative person when it comes to delivering music online, you know something is terribly wrong with the music industry itself.

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David Byrne's New Radio Station

March 31st, 2005 | No Comments | Posted in Main Page

A bit of a tangent from the world of tech and telecom, but if you get a chance, check out David Byrne's new online radio station. It's definitely what you would expect from the Talking Heads frontman: eclectic, different, intriguing, strangely addictive. I'm not a big online radio listener but I've got Mr. Byrne bookmarked already.

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Bell Canada Unveil VOIP Service

March 31st, 2005 | No Comments | Posted in Main Page

Bell Canada moved cautiously moved into the VOIP market today by launching a Vonage-like service in three cities in Quebec. To be honest, it looks like a pilot project and a shot across the bow of the CRTC, which is taking its sweet time deciding whether or not to regulate VOIP. There are several intriguing parts to Bell Digital Voice. First, the regulatory angle. Clearly, Bell is displeased the CRTC appears to be leaning towards a regime where VOIP services offered by incumbent carriers will regulated, while rivals such as Rogers Communications and Vonage Holdings will be free to set their own prices. By brazenly launching a VOIP service before the CRTC makes a decision, Bell is saying “Look, VOIP is an Internet application so stop thinking of regulating our VOIP service in the same way as traditional telephony service.” Bell has bolstered its case by launching Bell Digital Voice without it to its broadband access service - thereby making it clear to the CRTC its VOIP service is just an Internet application available to anyone with broadband access. My take is if the CRTC regulates ILECs who offer VOIP service, Bell will launch a legal challenge. Basically, Bell is backing the CRTC into a corner in a game of chicken.
As for what Bell is offering with Bell Digital Voice - three simple plans ranging from $38 to $45 a month, which is not cheap but reasonable. It includes lots of features, including the ability to do conference calling, and free long-distance. Eamon Hoey, a telecom consultant, describes Bell Digital Voice as the “beginning of the beginning of the end” of the long-distance business, which had already had the bottom taken out of last year when Bell launched a $5 for 1000 minutes plan.
All in all, I would give Bell credit on all fronts. It introduces what appears to be an attractive service that's reasonably priced, and sends a strong message to the CRTC that push has come to shove. We know where Bell stands, now it's a matter of finding out where the CRTC is going to go with VOIP.

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Nortel's Coming Out Party (a.ka. an AGM)

March 30th, 2005 | No Comments | Posted in Main Page

For investors still curious about Nortel Networks' plans for an AGM, you can now mark down June 29 on your calendars. In a regulatory filing today, Nortel said its 2004 and 2005 AGMs will be held then. If you like corporate drama, we can only hope the AGM is anywhere near as exciting as Nortel's last AGM in Halifax. That meeting lasted more than five hours due to questions from shareholders, and required an unscheduled break for lunch to placate the hungry masses. Let's hope Nortel shareholders don't get lulled into complacency by CEO Bill Owens' deliberate and calming tones. This is a rare opportunity to grill…i mean, question…senior management about what the company's embarassing accounting scandal, including the firing of ex-CEO Frank Dunn.

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Tracking Down VOIP Investments

March 30th, 2005 | No Comments | Posted in Main Page

In the hunt for the rare VOIP investment play, Russell Shaw offers a take from the Wall Street Transcript, which features an interview with Kaufman Brothers analyst Ari Moses. So what are Moses' leading VOIP plays? deltathree, Covad and Net2Phone. What I find most interesting is the Q&A suggests analysts are starting to think about VOIP investment plays. For the enterprising analyst, there is an opportunity to carve out a distinct niche - much like Mary Meeker and Henry Blodget capitalized on the dot-com boom to make themselves into superstars (and I use that term loosely given they only knew a tad more than the rest of us). I think over the next year, there will be VOIP IPOs, although the market will likely be pragmatic and cautious (translation: demanding that a company have sales, profits and customers) rather than speculative. In Canada, Terry Matthews' Mitel Networks sticks out as the most likely candidate, although CEO Don Smith sounded cautious about the idea in a recent interview.

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Regulatory Wrangling

March 30th, 2005 | No Comments | Posted in Main Page

In a sign of things to come as the lines between carriers and cablecos disappear, Telus has filed an application with the CRTC to order Shaw Communications to stop selling telephony service. The complaint has to do with Shaw not filing the proper documentation with the CRTC and not following some minor rules. In response, Shaw accuses Telus of regulatory harassment and anti-competitive behaviour.
In and of itself, Telus' application is not terribly exciting but it offers some valuable insight into how carriers and cablecos are going to butt heads and use any weapons they can to fight it out. It's a logical environment when you are selling the exact same services to the same group of consumers. You can go battle it out using the big weapons - prices, customer service and bundles - but you can bet there's also going be plenty of picking, niggling, complaining and whinging going on in public and behind the scenes. The CRTC's decision to expedite its decision-making process will be a necessity as we see more focus on he-said, she-said regulatory spats.

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Nortel Goes on the Defensive

March 29th, 2005 | 1 Comment | Posted in Main Page

Maybe Nortel Networks CEO Bill Owens’ extensive contacts within the U.S. military are going to pay off in spades after all. Maybe Owens, a former U.S. Admiral, wasn't pulling our legs when he talked about the new strategic focus on winning more government/military business. Maybe I’m going to have to finally bite my tongue about Nortel’s fuzzy strategy. What’s changed? Well, Nortel unveiled a contract today with the U.S. Department of Defense to create a new private network. Sure hope this is a sign of things to come because Nortel’s 2004 third-quarter results were disappointing when it came to wireless, optical and Asian sales. Then again, maybe putting strategic emphasis on the military and government is a no-brainer given President George Bush is intent on continuing the war on terrorism. The military and government market have potential for growth, which is a lot more than you can say about other parts of the telecom market.
ZDNet's Russell Shaw provides some more details about the contract, and asks whether it provides people with more confidence in VOIP.

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