VOIP services

Google VOIP Apps Stare Down Startups

EStara Inc. made "click-to-talk" a Web reality long before eBay Inc. (Nasdaq: EBAY) and Google (Nasdaq: GOOG) expressed interest in the technology, but will there still be a place in the world for a small company like it once the big boys catch up?

The question matters now more than ever as companies of all sizes are growing wary of Google's ability to penetrate IP communications markets to reach their customers with a better or cheaper service.

Enter click-to-talk, an application that allows a customer to connect with a business (or another person) via a Website. Several online businesses see click-to-talk as a way to keep customers from bailing out of an ecommerce transaction over a simple question. (See Poll: Google Talk Heard Over Skype Hype.)

Google, which already has a consumer PC-to-PC VOIP service called Google Talk, has been experimenting with click-to-talk, but it won't say what its intentions are.

EStara has been in business since 1999 and holds several patents for click-to-talk and related technologies. (See Skype Extends Its Tentacles.) But eStara VP of Technology Joe Siegrist tells Light Reading he didn’t believe his company’s patents on click-to-talk technology could preclude others like Google from developing (and selling) their own flavors of the communication feature.

Here's what Google's FAQ page has to say about click-to-talk: “We're testing a new product that gives you a free and fast way to speak directly to the advertiser you found on a Google search results page -- over the phone." Google has been beta testing the feature at various areas of its property over the past month.

So even with its long head start, eStara could face a serious risk of being pushed out of future click-to-talk deployments should Google decide to resell the feature -- or give it away to companies as a value-added service for advertising on Google.

Meanwhile, eStara is amused at the buzz it's getting for likely being next on the list of companies Google may marginalize. “It’s made us laugh a little bit because everybody talks about how ingenious Google is for coming up with this technology when eStara’s been doing this for five years,” says eStara's Siegrist.

EStara's click-to-talk solution includes a set of phone numbers, PSTN interconnection, software and integration, as well as a full suite of reporting features. The company has sold solutions to 12 large Internet directories around the world, the biggest among them being Verizon Communications Inc. (NYSE: VZ), Yahoo Inc. (Nasdaq: YHOO) Ireland and Amazon.com, Inc. (Nasdaq: AMZN).

Amazon was the first U.S. customer to do a major rollout; around 14 million of its advertisers use the click-to-talk service. Verizon Superpages started using eStara click-to-call in 2003 and the call link appears near some 100,000 advertisers at the site, eStara says.

In order to connect click-to-talk calls to any business that signs up, eStara has established interconnection agreements with such PSTN backbone providers as MCI Inc. (Nasdaq: MCIP), Level 3 Communications Inc. (Nasdaq: LVLT), and AT&T Corp. (NYSE: T).

EStara makes its money from the sale of the original application and set-up services, as well as on an ongoing basis tied to metrics like Web traffic, number of telephone numbers issued by the client, and number of VOIP calls placed from the client's site.

EStara, which is privately-held and VC-backed, has been profitable for the past eight quarters, and has seen revenues increase in each of the last 19 quarters, Siegrist says. The company, he says, has no plans of going public.

The company says it faces little or no competition to install turnkey click-to-talk solutions at large enterprise customers like Amazon.

But that position won't last forever. And when Google and others become more active in taking advantage of their reach and IP technology to find more platforms for its advertisers, eStara looks to be a sitting duck.

"It's been kind of mystifying to us to watch it all unfold -- being the company behind the scenes making it happen for a lot of companies out there," eStara's Siegrist says. Siegrist is the co-inventor of the first “PC to phone VOIP for eCommerce” application, the company says. (See Links: Facing the Google Future and Google Searching.)

— Mark Sullivan, Reporter, Light Reading

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erictwendell 11/30/2013 | 12:55:06 AM
re: Google VOIP Apps Stare Down Startups I believe that the world is moving towards the IP solutions to meet their telecommunication needs. The IT Companies offering IP services for communicatin purpose has significantly overcome the problems of the telecom service providers were facing to access the long distance or international calling at very efficient calling rates!
da 12/5/2012 | 4:06:41 AM
re: Google VOIP Apps Stare Down Startups IP communications in principle allow much more functional emergency service. Any IP endpoint with embedded GPS can provide very accurate location data for E911. And if you have right applications to process that calls, it's possible, for examle, to dynamically redirect emergency calls to the nearest mobile emergency team. And GPS receivers are getting cheaper. Moreover, I guess any wireless access point with sufficiently accurate clock can serve as GPS proxy.

But that is only relevant if one really wants to make better emergency service... But if one insists on specific implementation via old infrastrcuture just to make life harder for new players - that's another thing.
danestara 12/5/2012 | 2:50:43 AM
re: Google VOIP Apps Stare Down Startups I think to characterize eStara as a sitting duck is a bit misleading considering that its business model is primarily focused on providing click to call solutions for large enterprise customers.

Google's applications connects people to advertisers, which is a service that eStara enables for other directories and search engines that want to provide pay per call services to their advertising listings. However, when it comes to enterprise deployments on corporate websites, there's little evidence that Google is even interested in entering this space as the revenue is not ad-based.

Few people realize that a solution for click to call involves much more than throwing a click to call button on a site. A solution for click-to-call is totally different (and much more complex) than simply using VoIP technology to hook phones together. It also requires things like self-provisioning for buttons and links; ability to manage, control, and route calls; reporting and analysis tools; advanced functions like bi-directional data passing; complementary tools like click-to-chat and call tracking; etc. That's why companies like Amazon's A9 selected our company's solution to power their click-to-call service, and why eStara is the market leader in delivering click-to-call infrastructure to power both enterprises and directory/search partners. For sophisticated companies, why buy into the time, effort, and expense of trying to adapt a raw technology when you can instead buy a complete and proven solution to your specific need?

Google entering this space validates this technology. Google has shown before that they have the ability to accelerate a market and we're excited to see it happen. Welcome to the party!
paolo.franzoi 12/5/2012 | 2:50:40 AM
re: Google VOIP Apps Stare Down Startups
Is the service a replacement for a primary voice line?

Perhaps you should start by understanding the actual requirement. You will then say, "Well what about people with no phones, just click to dial." Well, I guess they are not calling 911.

Hope they live.

materialgirl 12/5/2012 | 2:50:40 AM
re: Google VOIP Apps Stare Down Startups As voice moves from a product to a feature on a web page, what is your E911 requirement? Who is liable if someone who clicked to ask a question gets a heart attack over the answer and the emergency crews cannot find them immediately? Just wondering.
rjmcmahon 12/5/2012 | 2:50:39 AM
re: Google VOIP Apps Stare Down Startups Who is liable if someone who clicked to ask a question gets a heart attack over the answer and the emergency crews cannot find them immediately?

I don't know who will be held liable though Merck will have the lawyers required to defend the cases tied up for awhile.
materialgirl 12/5/2012 | 2:50:35 AM
re: Google VOIP Apps Stare Down Startups That is my point. The repressive E911 requirements placed on VoIP providers are scary. Why limit it to a primary line? What about the person who dies because they call fron a second line? If they are on the way out, are they going to run to that primary line?

Where does it stop? The E911 requirements already placed on service providers could just be openers, especially if they are placed there to stop competition rather than to actually help anybody in need.
paolo.franzoi 12/5/2012 | 2:50:34 AM
re: Google VOIP Apps Stare Down Startups
No, you are a fool to assume that a social contract that is important to people should be tossed aside because it is hard in the technology. Guess what E911 and CALEA were hard in the TDM world.

Get over it.

turing 12/5/2012 | 2:50:32 AM
re: Google VOIP Apps Stare Down Startups There are times when capitalism needs to be left alone, and there are times when a public safety need overrides it. If the FCC let it be optional, wealthy people would be willing to pay more for 911 service, but people who are trying to save money (like the ones who move to voip) will skip it and that is bad for the public at large. It's also unfair to make the non-voip providers have to charge and pay for 911 if their voip competitors don't for the same service.

The real hard part with this will be determining who is a primary line provider. Does Skype count as one? They have skype-out and handsets for your home now. Will Google and Yahoo voip count?
danestara 12/5/2012 | 2:50:29 AM
re: Google VOIP Apps Stare Down Startups Not exactly, they're bringing much needed attention to the application but going after a completely different audience. Google's offering this to their advertisers.

eStara does not go after advertisers nor does it have an ad network that it's trying to build. We provide the backend technology for large enterprises, and directories with bidding engines in place (Yahoo! UK & Ireland, Amazon A9, Verizon Superpages, etc.)that would like to provide a pay per call model to advertisers.
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