Broadvox has big vision for voice-over IP
4:30 am, December 16, 2002
group of seasoned entrepreneurs is betting that ‘voice-over IP’ is the next big thing.
The entrepreneurs have formed BroadVox Ltd. of Garfield Heights to take advantage of the growing trend of moving long-distance voice calls off traditional telecommunications networks and onto the Internet.
BroadVox has two business models poised to take advantage of the growth of voice-over Internet protocol, or IP, technology. The first is a second-tier long-distance carrier that sells wholesale access to its equipment and network to telecommunications companies so they can originate and complete phone calls. The second offers businesses an Internet-based alternative to their traditional Centrex phone system.
The wholesale business launched earlier this year and is operating in 19 markets. The company plans to be in 30 markets by the end of the first quarter of 2003, said Jeffery Williams, vice president of marketing and channel development for BroadVox. Mr. Williams is the former owner of Now Online, a large, regional Internet service provider that he sold last year. He joined BroadVox in March, joining forces with Andre Temnorod, the chief executive.
Long-distance carriers that want to reduce the cost of delivering phone calls use voice-over IP, also known as VoIP, on a regular basis. Many long-distance calls travel, at least in part, over the Internet, rather than traditional phone wires. Sophisticated equipment is used to switch calls from the Internet to the phone network without any significant delay in the delivery of the call. The research firm Frost & Sullivan of Mountain View, Calif., predicts that 75% of all voice traffic will be handled by voice-over IP services by 2007.
BroadVox has been growing its business quickly. As of October, it had $3.1 million in annualized revenue, and it broke even for the first time in the month of September.
‘That’s impressive considering the state of the telecommunications market,’ Mr. Williams said.
Mr. Williams and BroadVox’s other managers have invested about $5 million of their own money in network gateways and other equipment needed to handle the telephone traffic.
Mr. Williams, who also acts as spokesman for the company, said seeking outside investors hasn’t been necessary but is a possibility.
‘Sometimes outside funding makes a lot of sense and sometimes it doesn’t,’ he said. ‘We have the capacity to move forward as we are.’
Moving forward includes launching the second half of its business last month. BroadVox is beginning to offer phone services directly to businesses. BroadVox markets a phone system that essentially can replace the Centrex systems many businesses now rely on for their phone service. It initially will target businesses in Cleveland, New York, Dallas, Chicago, San Francisco, Los Angeles and Miami. It plans to spend about $1 million promoting the new service.
Although in its infancy, the IP-Centrex phone business is expected to be a multibillion-dollar industry in the latter half of the decade, according to various projections by industry researchers.
Instead of using a traditional phone system, BroadVox phones will connect directly to the Internet. The calls will be handled much like the long-distance calls are handled using voice-over IP technology.
Added features of a voice-over IP phone include the capability of using a BroadVox web site to program the phone to handle incoming calls differently depending on where the call is coming from and at what time of day it is received. For example, the system can be programmed to send calls from unknown callers directly into voicemail, while calls from family members ring directly to the user’s cell phone.
Also, companies that have multiple offices are able to connect with each other without incurring long-distance expenses because the calls stay on the IP network. Such a system has been working perfectly for Vadim Kleyner, president of Cost Update. The Cleveland-based company operates a web site that helps people determine the lowest prices on various electronics parts.
Cost Update has an office in Russia and is able to connect to that office simply by dialing an extension on its voice-over IP phone.
‘It’s perfect,’ Mr. Kleyner said. ‘It’s just like another phone system’
Cost Update was one of about a dozen companies that tested BroadVox’s service for several months.
BroadVox relies on third-party distributors to sell the phone service
‘We’d like to have 15,000 phones (installed) by this time next year,’ he said. If BroadVox reaches that goal, it would translate into nearly $8 million in revenue on an annualized basis.
CEO Mr. Temnorod previously built and sold two technology-related companies, PC Importers and Nexbell Communications LLC. Mr. Temnorod and three other executives who had worked with him in his other businesses formed BroadVox in August 2001. The company now employs 33 and is considering a move downtown. Mr. Temnorod declined to be interviewed for this story.
Internet phone firms call for customers
By TOM JACKSON
4:30 am, April 5, 2004
Two Cleveland companies, Broadvox LLC and gee-fon, are offering local and long-distance phone service over the Internet for customers seeking an alternative to traditional phone companies.
Broadvox, at 1228 Euclid, launched its service last month for residential customers. The company is sending about 300,000 advertising fliers to Northeast Ohio residents and soon will begin a national advertising campaign using TV, radio and direct mail.
Residential service also has launched in Canada, and the company plans to offer service in all 50 states by the end of the year.
Gee-fon, a subsidiary of Phoenix Telnet LLC, also has launched Internet calling and wants to sign up 40,000 customers by year’s end.
Both companies are in the relatively new business of providing telephone service by using the Internet to transmit phone calls, thereby bypassing the telephone infrastructure used by typical telephone companies. A few years ago, the audio quality for such calls was poor. The technology recently has improved enough to provide a practical alternative to regular telephone service.
Broadvox president Jeffery Williams calls attention to the company’s $29.95-a-month service that includes unlimited local calls and unlimited long distance calls in the United States and Canada. The price also includes voice mail, caller ID, three-way calling and a ‘friends and family’ number in another area code so that a customer’s most frequent long-distance caller has a local number to dial.
Mr. Williams said to use his service, a residential customer needs a broadband Internet service (such as DSL or cable modem) and an analog telephone adapter, which the company provides. A computer isn’t needed. A typical customer might pay $76.85 the first month, including a set-up fee of $34.95, then $11.95 for shipping and handling for the phone adapter.
If a customer pays $30 a month for Broadvox’s service and another $35 for broadband Internet service, that’s a total phone bill of $65 a month. That’s probably the average amount of money a customer might pay for normal phone service and a slow dial-up Internet service, Mr. Williams said.
Mr. Williams said Broadvox has about 50 employees. The company is busy hiring new employees to provide customer service for its new residential offering, and it expects to have around 100 employees within six months, he said.
Mr. Williams said when he joined Broadvox in March 2002, a few months after selling Now Online, his Internet service provider, the company was a few months old and had about a dozen employees. The company began transporting calls long distance for other phone companies, and expanded last year into offering telephone service to businesses.
Broadvox is privately owned and doesn’t disclose revenues. Mr. Williams said revenues last year were ‘in the eight figures.’ He said the company is profitable and is financing its expansion from its own revenues.
Gee-fon’s offering requires its customers to have a computer with a USB port, but it doesn’t require a high-speed Internet connection. Even dial-up will do, said Tim Khayat, gee-fon’s vice president of operations.
Mr. Khayat said his company’s service officially launched Feb. 11. Customers can get local phone service for $15.95 a month. Local calls and long distance calls to the United States and Canada cost $39.95 a month.
‘We have had several hundred people beta testing the system and using it as a beta service for three months now,’ he said. The company’s business model calls for about 40,000 customers by the end of the year.
‘We feel real confident hitting that number,’ he said.
Gee-fon customers who are hitting the road can plug their telephones into any computer, as long as they’ve taken a few minutes to download the necessary software, Mr. Khayat. If a customer is visiting a friend and wants to use his computer to make long-distance calls, it doesn’t matter where the computer is.
‘He could be in China,’ Mr. Khayat said.
(Published Crains Cleveland Business)
Maybe i should do something with my Blog. It’s been almost two years since i posted anything
- Kevin O’Leary
One of the first things successful people realize is the old
adage, “If it is to be, it is up to me.” That is, for you, the fact that your
success and your course is up to you. This doesn’t mean that you do it all
alone. It simply means that you take responsibility for your life and your
Too many people today look at opportunity and figure it is up to
someone else to make sure they get it. They look at financial security and hope
that the government will make sure they live safely in retirement or in case of
disability. They wait and wait, figuring that it is up to someone else. And
then the wait is over, and it is too late to do anything. Their life is over
and they are filled with regret.
This isn’t true for you however. You know that you must take
responsibility for your life. It is up to you.
The fact is that nobody else is going to do it for you; you must
do it yourself.
Now, some people may say, “Jim, that’s a lot of responsibility.”
Friends, that is the best news you can ever hear. You get to choose your life.
Hundreds of millions of people all around this world would give anything to
live in the situation you do, just for the chance to have the opportunity to
take control of their destiny. “It is up to you” is a great blessing!
1. You get to chart your own destiny. Maybe you want to start a
small business and stay there. That’s great because you can choose that. Maybe
you want to create a small chain of stores. Maybe you want to have a net worth
of $100 million. That’s okay too. The idea is that you get to choose. You can
do whatever you like. Different people have different dreams and they should
live them accordingly.
2. You can reap what you sow. Sleep in and go to work late and
reap the return. Or get up early and outwork the others and earn a greater
return. Place your capital at risk and earn a return or place it at greater
risk and perhaps reap a greater return. You decide what you will sow and, thus,
what you will reap.
3. No one else can stop you from getting your dream. Yes, there
will always be things that come up and people who may not like what you are
doing, but you can just move on and chart your own course. There is great
freedom in that.
4. You experience the joy of self-determination. There is no
greater pride than knowing you set your mind on something and accomplished it.
Those who live with a victim mentality never get to experience the joy of
accomplishment because they are always waiting for someone else to come to the
rescue. Those who take responsibility get to live the joy of seeing a job well
Let me ask you a question: Where will you be in 5 years? 10 years?
25 years? Do you know? Do you have an idea? Have you ever dreamed about it or
set a goal for it? Are you willing to take responsibility and recognize that,
“It is up to you?”
You will be wherever you decide to be in those timeframes. You
decide. It is up to you.
And that is very exciting!