VoIP: Amidst Wreckage, Profits Emerge

Posted by: Olga Kharif on August 21, 2007

Over the past half a year, bad news seems to have completely blocked out the good news in the Voice over Internet Protocol (VoIP) industry: Vonage has been dealing with legal woes. SunRocket went out of business. Skype had battled a service outage.

But I want to talk about the good news: More and more Web-calling companies are getting to profitability. Skype has been profitable for a couple of quarters. InPhonex, a provider of business-class VoIP services, is profitable and debt-free, according to the company. Packet8 recently turned a profit, albeit one due to a one-time event.

This is the first proof that, despite fierce competition from cable companies and telcos, VoIP can be a viable stand-alone business. With good business practices and cost controls in place, perhaps even Vonage could become profitable.

Reader Comments

VoipSpider

August 21, 2007 2:59 PM

I've been reporting on everyone of the above broadband phone companies except Inphonex. Where did you get the information that they are in the black? That would be really good news indeed, especially for those of us who sell VoIP for a living and need to find some financially safe companies to work for. (I'm pretty sure I wasn't the only agent to get hurt by SunRocket's early demise.) LOL

Tubag Bohol

August 21, 2007 11:33 PM

We don't have that much problem with VOIP companies. Our problem lies on the fact that we don't have enough Internet speed. Internet bandwidth is the issue that ISPs must deal with.

Susan

August 22, 2007 1:41 PM

Hi Olga,

I agree with your point that VoIP can be (and is becoming) a viable stand-alone business. Through my work with a provider of session border control solutions for securing VoIP networks, I have also observed that VoIP service providers can't do it alone, and that there is a need for partnering with different "best-of-breed" solution vendors in order to provide fully secure and reliable VoIP. Also, because the VoIP world is expanding so rapidly, we're now moving towards Unified Communications -- the integration of real-time servcies such as video, IM, presence and others. What have you been hearing lately about VoIP in the business space and how enterprises want to integrate real-time communications into business applications?

-Susan

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Bloomberg Businessweek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, and Douglas MacMillan, dig behind the headlines to analyze what’s really happening throughout the world of technology. Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

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