U.K. Startup Challenges Vonage, Skype
Published September 22nd, 2005
Switch Call, a little 16-man U.K. telecom startup that, until now, has specialized in B2B services, has launched itself into the consumer arena with a voice over Internet Protocol (VoIP) offering that sets new lows for pricing and vows to take on the likes of Vonage and Skype. Its rates look to be about half those of Vonage’s in the U.K., and about 20-percent less than Skype charges for its SkypeOut service to the switched telephone network.
Normally, yet another VoIP startup would get little note, but Switch Call’s advent comes fast on the heels of eBay’s deal to buy Skype for as much as $4.1 billion and, notably, Switch Call’s revenues of $12.67 million last year are almost double what Skype recorded.
“The new service from Switch Call takes it head-to-head against rival services SkypeOut and Vonage,” the company said in announcing its service, making no bones about whom it is targeting.
What Switch Call is offering is a service that starts at $9 per month, with 500 minutes of calling included, or twice that for unlimited calls, roughly the same as Vonage charges for such service. Its long-distance calls to the United States and most places in Europe, however, are half of Vonage’s rates and 20 percent less than Skype. As with just about every VoIP service, calls between Switch Call users are free and unlimited.
Switch Call rates include a free VoIP phone as part of a one-time “joining fee” of $45 or $90, depending on the model of phone chosen. The company is offering phones that simply plug into a PC’s USB port, with no need for the traditional VoIP adapter. That feature, Switch Call argues, makes it the simplest VoIP service offered to set up, a selling point the company plans to tout heavily.
“Technologies tend not to become truly mass-market until they become simple as well as beneficial,” argues Switch Call Managing Director Nick Kaulbach. “Many people fully understand that VoIP services are beneficial to them based on their low cost. But until now, I think that there has not been a service simple enough to break through into the mass market.”
In a final swipe at Skype, which uses P2P technology instead of SIP, Switch Call also points out in its marketing material that its service is “NOT PEER TO PEER – No loss of bandwidth – unlike some of Switch Call’s better known competitors, Switch Call does not use up YOUR internet connection for OTHER PEOPLE’S calls!”
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