Skype files for an IPO – good news for Mobile VoIP

On Monday last week Skype filed its S1 supporting an IPO application with the SEC.  For many industry observers, this was not entirely unexpected news, many commentators would have prepared their ‘Skype goes public’ blog posts months ago.

http://www.businessinsider.com/skype-files-for-ipo-2010-8

Aside from the bizarre BSkyB litigation related to alleged trademark confusion over Skype’s name, we learned a fair deal about Skype’s strategy from the S1 documentation:

Freemium as a model works – just over 6% of Skype’s 560 million strong user-base pay for service, spending USD 96 per annum each. Skype is a cash machine (just as Morodo would be once we get critical mass).

Mobile, Value-Adds and Enterprise and key growth areas – now that Skype has established relationships with several Mobile Operators, it forecasts stronger revenue from mobile. Premium value-added services and SME (Skype for Business) are named as strategic growth areas.

Securing proprietary technology cost Big Time – Skype paid cash and equity at the value of approximately USD 300 million to the Founders to secure an audio-codec license from JoltID, something that was overlooked in the original eBay acquisition. That, right there, is the value of using Open Source codecs.

A number of people have asked us what this means for Morodo. It’s all good news as far as the team is concerned. Why?

1. Continued competition in the Mobile VoIP space validates our business. If nobody was doing what we do, we’d be worried. We’re pleased to remain a leader in Mobile VoIP app technology.
2. The Mass-Media loves Mobile VoIP. Use of an alternative voice and data carrier from a mobile has yet to reach mass-adoption.  The market is open, the technology is proven (and the benefits obvious), it’s all about growth.
3. The incumbent giants have awoken.  We’ve been saying for some time that the big Mobile Operators would eventually adopt Mobile VoIP strategies and now they are. Interest in your company is growing.

Another big week in VoIP that brings yet more valid reasons that VoIP services and products are big business.

Google Voice for Gmail – not a MO-Call killer

On Wednesday Google finally launched Google Voice for Gmail causing a big splash in the media and huge waves in the blogosphere. We fielded a fair few calls asking for comment so we thought it timely to share our thoughts with you.

Google Voice is a whole lot of unrealised potential. The addition of voice calling and text messaging to Gmail has been a long time coming.  The search giant bought Grand Central in June 2007,  Gizmo5 in November 2009 and GIPS in May of this year. Our initial thought was: it that it? Following the cancellation of Google Wave earlier in the month, it’s a wonder that so few features have been included in this release.  And most notably, why so quiet on the Google Voice mobile app?

Don’t misunderstand us; we’re not playing up the weaknesses to hide the strengths of the offer. We should be very clear and state that we do not feel at all threatened by Google entering our space. It certainly didn’t stop anyone investing in Mobile VoIP companies this week.

Many a blogger led off with talk of Google Voice becoming a Skype-killer, well, that’s as may be, but for Morodo, it’s all good news. Why? Here are some the key points as we see them:

Competition is Validation (and Free Marketing)

MO-Call has been competing against thousands of mobile operators, fixed line incumbents and VoIP companies since it’s own launch.  One more player, however big, will not make a difference. In fact, the larger the alternative VoIP player, and the more marketing money they spend, the better. It’s about time the mass-market woke-up to the alternatives out there.

Profitable Pricing.

A lot of nonsense has been written about VoIP being a zero-sum game, a race to the bottom. It’s not. It may surprise you to learn that offering rates sub USD 2 cents per minute to European destinations is good margin business. Morodo can compete and be profitable.

Calling will not be free-to-all-destinations for a very long time, not whilst so many operators around the world (and let’s face it, governments) continue to earn revenue from call termination.

Mobile Applications.

MO-Call is a mature mobile VoIP application, tried and tested in the market on more than 1,800 different makes and model of phone. It’s simple to use, has a low memory footprint and doesn’t dominate the battery.

The existing Google Voice mobile app is complex by comparison and not friendly on power and processing. Many of our immediate competitors distribute huge, hungry and obtrusive applications, we say: Keep It Simple Stupid.

On the mobile, it’s about talk and text: that’s where the revenue is – that’s where the customer wants to save money.

Mobile Networks

Google is on the horns of a dilemma. A few weeks ago, in partnership with Verizon, Google provide a proposal on Net Neutrality to the FCC in the USA (the regulatory body for telecoms). If you’re not familiar with this news story, perhaps the best coverage can be found here at Circle ID.

In the light of the Google Voice for Gmail launch it is now somewhat significant that Google made their Net Neutrality play together with Verizon, the only US carrier yet to host a Skype service on it’s mobile network. We’re sure there are plenty of non-compete terms in that Skype co-op agreement.

This highlights a huge problem for Google moving forward, the ability to build a Mobile VoIP business where the carriers feel threatened. OK, you can remind us that we have written many words in the past about carriers embracing Mobile VoIP, and they are, but carriers view Google Voice in a very different and threatening light. It’s going to take a lot more than revenue share on Google Mobile Adsense and promised increased data usage before we see the search giant secure any Verizon-Skype-alike deals.

Mobile Manufacturers

Google’s Android Mobile Operating system is a massive success story. Chances are it’s a Mobile Operating System that most people who read the papers have heard of and that’s probably a first in the history of the cellphone (anyone remember Psion?).

Android’s market penetration has been led by the mobile manufacturers, the HTCs and Samsungs of this world. It’s license free, it’s completely Open Source and thousands of developers work on apps that run on it. What’s nice for Google is that the Operating System embeds some of their key services, like Gmail, on the device. Try using an Android mobile without a Gmail account, it’s a pretty poor experience.

Unfortunately for Google, these embeds and this diversity in production might not be much of a help in the long run, simply because the people that buy the most phones direct from the factory are the Mobile carriers themselves.  If Vodafone are going to buy 500,000 Samsung Galaxies, you can be sure they can ask for Google Voice to be removed.

The on-device playing field for Morodo is a lot leveler than it might first appear.

Google needs to pull something special out of the bag, it’s facing increased competition in it’s core search business, it’s been battered over privacy all over the western world, it’s struggling to compete with Facebook and it’s coming off the back of a string of failed public betas.

Twelve months ago it would have been inconceivable for John Gruber to write his recent piece on CEO Eric Schmidt, now it’s par for the course that any announcement from the company will attract a round of Google-Bashing.

This time next week, a hundred blog posts and news articles will be warning you of the danger of Google data-mining your call records so it can better target ads at you.

Press Release: MO-Call Putting Rate Cut Decisions in the Hands of Customers

London – Morodo Limited recently let the users of their popular international calling service, MO-Call, decide which destinations they should drop their rates to next. MO-Call users voted and are now making the most of slashed rates to Poland Mobile, India Mobile and the USA with rates being cut by up to 50%.

New cheaper rates as voted by MO-Call users:

• Poland Mobile: $0.15 /min (40% cut)
• India Mobile: $0.02 /min (50% cut)
• USA Landline and Mobile: $0.01 /min (50% cut)

MO-Call provides various ways of making low cost international calls, including mobile apps available on over 2,000 handsets, computer applications and web browser apps.

There is no charge to set up a MO-Call account and new users receive some free credit to test the service. After the trial, MO-Call customers only pay for the minutes they use, making savings of up to 95% compared to traditional mobile and fixed networks.

“MO-Call provides one of the easiest, cheapest ways to keep in touch with the important people in your life. With our latest promotion we put it to the MO-Call community decide which countries they wanted to call for less. They voted and we listened.” said Andrew Reid, Morodo CEO.

About Morodo

Seeking to re-define the way we communicate via mobile devices and the Internet, Morodo helps people keep in touch with whomever they want, whenever they want, from any device they want.

Morodo provides telecommunications services to hundreds of thousands of people around the world through the MO-Call software applications for mobiles and computers. Simple and seamless to use, MO-Call offers easy access to free and low-cost calling for anyone, anywhere.

Morodo news is available at the company website: www.morodogroup.com

MO-Call specific related news is available from the MO-Call blog:www.mo-call.com/blog

Media Contact:
Andrew Reid  (e-mail: areid@morodo.co.uk)
Morodo Limited
Level 6
68 Lombard Street
London EC3V 9LJ
United Kingdom

5 reasons why WiFi and WLAN are the Alternative Mobile Networks

In a recent survey, MarketTools states that seventy eight percent of people in the USA who own smartphones with Wi-Fi capabilities would be interested in an application that would use Wi-Fi to deliver ‘five bars’ of coverage at home or in the office. Though the sample group was not exactly huge, the received wisdom underlines several key trends in the mobile industry:

1. Every smart device has WiFi. According to research from InStat, the next four years will see an increase in the number of Wi-Fi-enabled devices to nearly 2 billion by 2014. This includes mobile phones, laptops, Blu-ray players/recorders, e-readers, and digital televisions. The Internet of Things will be WiFi enabled.

2. Mobile Operators are already using WiFi to alleviate data bottlenecks on the network. In the USA, AT&T handled 68.1 million Wi-Fi connections on its network in the second quarter of 2010, compared to just 15 million in the same quarter last year. The AT&T WiFi hotzone pilot project has been building out trial municipal WiFi in North Carolina and will go live in Chicago on a few months time.

In the UK, a YouGov survey found that 50% of UK smartphone owners use WiFi every day – 40% of them because its faster for mobile internet access, and 50% because it is easier than using 3G. Most notably for Morodo, 80% would be interested in a mobile operator service that offers cheap calls through WiFi.

3. 4G is a long time coming. Wimax and LTE are much talked about high speed mobile technologies but they will be a long time coming to the mass market. As the Intelligence Centre points out, GSM provides better overall coverage globally. Mobile Network operators should leverage existing low-cost technologies, such as WiFi, to provide better data services in metropolitan usage hotspots.

4. The future is data – Western mobile markets are reaching 100% population penetration. New data services are the new revenue streams and cash-cows for Mobile Network Operators. VoIP is a data service. Browsing is a data service. Streaming and downloading are data services. Navigation is a data service. Pretty much everything the customer wants to do with their powerful mobile phone relies on a data service.

5. Wireless Local Area Networks are a growth business. Market researchers Dell’Oro Group say that overall Wireless LAN (WLAN) market revenues are expected to surpass $7 billion by 2014. The enterprise segment and the small office, home office segments will account for a majority of that growth, with enterprise revenues expected to expand more than 100 percent over 2009.

In summary, the Morodo Team predicts that WiFi enabled devices will drive data service usage for some time to come. This is great for us: WiFi is cheap to deploy, proven technology that works with Morodo’s voice and data services today. It’s also great for you:  WiFi knows no borders and unlike roaming with your mobile, is cheap to use when you travel, often free. The vast majority of VoIP MO-Calls originate over a WiFi network and we believe this will continue to be the case in the future. You can rest assured that we will be leveraging the abundance of WiFi for some years yet.

The Wholesale Mobile Network is Not Dumb

Earlier last week, Connected Planet reported a new Mobile Network planned to launch in the US later this year.  Backed by Harbinger Capital Partners, the new network, named Light Squared, will be 100% open, allowing VoIP, streaming video, peer-to-peer applications and any other conceivable service over both satellite and 4G.

Such is the power, potential and at present, poor capacity of Mobile Wireless that Light Squared can raise US$ 4.6 billion to build-out a high-speed 4G mobile data network.

So, who are Light Squared customers? According to CMO Frank Boulben, the new operator will target a mix of:

“National and regional wireless, wireline and cable operators; retailers;  device-makers; and Web-content providers…. We’ll have no gatekeeping rules on our network.”

It’s extremely significant that Light Squared will be open to all comers. For the Morodo Team, this is the next logical step in network evolution, bringing true competitiveness and a level playing field to the wireless world. There is no need for the network operator to ‘own’ the end-user in order to run a profitable business. We expect to see this business model become more popular as struggling networks consolidate to survive.

Elsewhere in the news, Juniper Research released a widely published report predicting sharp growth in Mobile App downloads. If you missed the headline, Juniper state that we can expect 25 billion downloads in 2015. That might seem like a big number but given the current global subscriber base in 2010, it only accounts for 5 downloads per mobile.  We think they might be rather cautious in their forecast.

The report noted that “freemium” is becoming the prevalent business model in mobile app distribution. That is, you give the app away and monetise it through service usage. That’s the model that Morodo has been expounding for some years.

Without a doubt, the consumer’s understanding of a downloadable mobile app is far more sophisticated today than it has ever been.

Unlimited Mobile Data means unlimited Mobile VoIP

It’s a truism of Telecoms that Asia leads the way in innovation. Japanese Mobile Network Operators are offering services that are years ahead of the West and creating massive revenues from virtual goods sold from the mobile.  They were first to market with video calling, Multimedia Messaging, mobile micro-blogging and the full experience Mobile Internet.

South Korea enjoys an enviable reputation for high-speed broadband connections per capita and an enlightened attitude to new network services. This week SK Telecom, South Korea’s largest mobile operator, announced new unlimited data plans for mobile, flying in the face of the latest received wisdom form the USA where AT&T recently switched from unlimited data plans to metered data use.

SK Telecom’s new offer is the inclusion of Mobile VoIP use with the data package (capped to 1,000 minutes per month). This makes SK Telecom the first operator in the world to offer a true Mobile VoIP service to its customer base.  One thousand minutes is more than 95% of consumers would use in any given month.  We’ve been banging on about this for years so it’s good to see our convictions realized.

There is absolutely no doubt in the Morodo mind that Mobile VoIP is the way of the future – with or without the co-operation of the network operators. Whether the customer uses 2.5G, 3G, 4G, WLAN or WiFi they can use Morodo’s MO-Call app directly from a mobile and save a fortune on voice calls and SMS.

Image: Bloomberg Business Week

Android Fragmentation a Challenge? Bring It On

We all know that Google owns the desktop, or should we say about 85% of all advertising revenue originating from it.  Over the last 18 months Google has promoted the open source Android Operating System in an effort to compete for a slice of the lucrative mobile advertising market.  Droids, as they a colloquially known, offer an enhanced web browsing experience.  They also are proving a popular vehicle for third party software developers.  These third party downloadable applications are extending the handsets functionality.  Traditional  utilities are being replaced by services, the classic  example of this happening in an app being MO-Call .

Recently there has been some criticism levelled at Google concerning platform fragmentation. No less than four different versions of this platform have been distributed during its very short lifetime. We’re often asked: is this a barrier to entry for developers?

The fragmentation debate is not new to Android.  Fragmentation has been a landmark of the industry ever since there was a mobile  industry.  The Morodo Team saw the individual characteristics of mobile devices as a huge opportunity, not a barrier. If we could cover all devices, what lead would that give us? What a challenge.

Morodo, as a software development house, supports all the popular Mobile Operating Systems.  We cover 95% of the developed World’s most popular handsets (including Android).  Downloadable software as a service is recognisable for what it can do, good Mobile VoIP embraces barriers and fragmentation and makes things simpler for the customer. And as far as we are concerned: what the customer wants – they get.

Footprint and Unified Services Key to Mobile Operator Success

A new report from Strategy Analytics details the changing dynamics of Mobile Network Operators, especially those that think and act globally.

The report fixes on four themes: Network Evolution; Traffic Evolution; Value Creation and Customer Loyalty. As the authors point out, much that is covered here follows on from Orange’s strategy announcement last week. In her speech launching the new direction, Orange CEO Stephane Richard made much of the need to deal with “the new incursion of new actors from the Internet world” and “the conquest of customers…and international development.”

As we have said many times before, for most Mobile Network Operators, growing a footprint and capturing new customers with Unified offerings means embracing the new Operators, like Morodo. Orange’s stated strategy is “growth through innovation.” What better way to expand than through the MO-Call Mobile VoIP model.

Image: NASA

Mobiles and WiFi: Everywhere

As reported in the Symbian Blog, the WiFi Alliance are close to announcing a new standard, WiFi Direct. What does that mean? Basically, any device with a WiFi chip will become a hotspot. Your mobile phone, your computer printer, your camera, your laptop, your PC, even your fridge, can all connect to each other wirelessly and share an Internet connection. This functionality won’t just be limited to your own devices, you’ll be able to wirelessly connect to the Internet via any WiFi enabled device.

The implications of this are significant. The local WiFi network and its connection to fixed broadband may yet usurp the Mobile Networks in metropolitan areas. The implications for Morodo and MO-Call type services are also significant as it means the availability of connections points could increase tremendously making free WiFi a real alternative network.

How many connected mobile phones in the World? This week, global mobile subscriptions passed the 5 billion mark. There are now more than 5 billion mobile connections working in the world today. The 6th billionth connection is forecasted for 2012.

Mobile is the largest single market in the history of humankind.

Image: Associated Press

Mobile VoIP Growing – Sharpen Up Your App Skills

Juniper Research published its latest Mobile VoIP report forecasting 470 billion minutes of call traffic originating from Mobile apps, like MO-Call, by 2015. As senior Juniper analyst Anthony Cox put it. “We forecast that mobile VoIP over Wi-Fi will cost operators $5 billion globally by 2015.” That’s revenue that disruptive companies, like Morodo, will be taking away from the Traditional Operators.

Perhaps we should leave the final word on this subject to Om Malik who wrote of Morodo’s like-minded companies: “..well, maybe the carriers who hate them so much will end up buying them.”

Elsewhere in the online press, further interesting statistics reported by AppstoreHQ. According to their latest metrics, 43,185 developers are working on the iPhone platform (iOS) and 10,199 developers are working on Google’s Android smartphone platform. Only 1,412 developers work on both platforms.

As we have stated before, Morodo developers work on both of these platforms and many more. When we looked at the Venn Diagram that AppstoreHQ published, we thought: I wonder how few developers can truly compete with Morodo for cross-platform coverage? In our opinion, not many.

Yet more good reasons why Morodo is leading the way in Mobile VoIP and Mobile Development.

Image: AppStoreHQ