Here's an idea that came from consultant Kaan Yigit: he believes Internet telephony service providers are making a strategic error by using low long-distance prices to go after new customers. This is a mistake, he said, because most of this audience spends little money as it is right now on LD because most LD calls are within North America.
The real audience for low-cost LD using Internet telephony service is ethnic consumers, who make calls to Asia, South America and Africa. Traditionally, these consumers have paid through the nose for LD but with VOIP, they can slash their prices in a big way. Yigit suggests this also explains why ethnic households are enthusiastic users of high-speed Internet access, which can be used to send e-mail and instant messages to friends and family overseas.
So what does this mean as far as marketing Internet telephony to non-ethic consumers? Instead of focusing on cheap LD, the major service providers such as Vonage, Primus and AT&T should talk about the cool features that Internet telephony offers such as the ability to easily do things such as call-forwarding and conferencing calls, as well as accessing v-mail via e-mail. This is what will generate excitement about VOIP as opposed to low prices.
At the end of the day, VOIP has to be something more than cheap telephony if it wants to become a real and viable business. Call me an optimist but maybe there's hope telephony can avoid becoming no-revenue industry. If you look at Skype, for example, it offers no-cost calling but charges for value-added features. Maybe this is a sign that consumers are actually willing to pay for specific services.