Back in April, Telecom Montly had an article with the title Consumer VoIP Dying.

When I reported this link on Twitter along with a comment that said something in the realm of bad service offerings, Luca Filigheddu immediately stated something that may not seem quite obvious to anyone except long time VoIP people: The point is to make VoIP transparent to consumers... They don't have to care whether it is VoIP or something else - also Maxim chipped in: bad offerings? I've been using betamax providers (e.g. www.12voip.com) for the past 4 years and must have saved thousands.

I still stand by my comment on bad service offerings, at least in the northern parts of Europe, but I would not be very surprised if this is valid other places also.

What triggered my comment was the immediate reaction on why some companies are closing down their VoIP service: Bad service offerings.

I am not talking about how much users are saving with VoIP - Maxim is quite right about that.

What Luca aptly point out: VoIP should be transparent.

It is not most places.

It is definitively not up in the Northern part of Norway (where I know a thing or two about whats available to consumers).

So, prior to VoIP up here, we where lucky to have ISDN. ISDN is still widely deployed, and Siemens have sold extremely many ISDN PBXes for the home and small office market per capita. Compared to the analogue telephone network - ISDN did provide a lot of interesting, and user friendly, services - which people got accustomed too.

Enter VoIP.

Actually - enter the analogue telephone with VoIP underneath.

This is a very big step backwards - and the sad thing is that people are buying into the idea as long as they don't have to pay (much) for the actual telephone usage. Just taste the word: A N A L O G U E.

Just a couple of months ago the most successful VoIP operator in the domestic market here i Norway finally got more or less the same services that old incumbents have had for the last 20 years (like call waiting, caller id-name, diversion, call transfer, hidden number, call back if busy - and the list goes on).

As far as I know, they have around 100 000 subscribers (out of a population of 1.1 million domestic house holds). By the end of Q3 2008 they had only 21 percent of the total market of domestic VoIP (Skype and these kind of offerings are not part of the official statistics).

This company have only One Novel Offering - a soft phone. Wow! How inventive! Oh - I forgot - you get a few gigabytes of "secure storage".

You will still get a analogue adapter which you may connect to your analogue DECT telephone.

Most of the companies provided traditional IP-based telephony legally in the domestic north European market do not have any good offering. Very seldom you can even get a soft phone. Price - price - price - are their main selling points, and in most cases their only offering.

Their offering is not about quality (like HD Voice) - it's not about service offerings (like a soft phone) - it's not about integration with cell phone services (like a soft phone on the cell phone and a cheap data subscription) - it's not about presence.

None of these companies are really doing anything to make VoIP transparent. Thus they are going to loose in the long run.

So who's going to win?

Skype is one very obvious answer. They do transparent VoIP. The whole ecosystem around Skype is going to win. Disclaimer: My company, Azuralis, is part of the Skype ecosystem.

The not so obvious answer is companies like Vyke, Fring, Truephone etc. They do have the primary driver for getting their customers: Price. However, they way their software works - the VoIP part becomes transparent. Then we have the most important point: Their offering are available on cell phones - which is becoming the primary unit for any kind of communication these days.