UPDATA
A Call to Phones
When the first Internet telephone hit the market last spring, the response was enormous - at least according to VocalTec Inc. The maker of the mercurial Internet Phone, VocalTec claimed 150,000 downloads from its Web site in the first three months of the software's release. The barbarians were at the gate, ready to topple the telco monarchs. A flurry of other, less polished computer- to-computer telephony products followed. Soon enough, folks with IPhones and similar permutations would be barking up and down the Net, and old Ma Bell would have to fall in line with lower long-distance rates. Yet, across jumpy, static-filled connections it was most often the uncomfortable, fuzzy silence of communication delays that resounded across the ether.
And guess what? A year later, the transmission delay is still there (yes, even in full duplex conversations), and Internet telephony - with all its "hang-ups" - has yet to revolutionize telecommunications. But no matter: International Discount Telecommunications Corp. (www.ios.com/), a Hackensack, New Jersey, Internet access provider and callback service, is positioning itself to become the first company to market with a computer-to-telephone product early this summer.
The company's Net2Phone software will soon enable users to dial any phone number - straight from their computers. Howard Jonas, Discount Telecommunications Corp.'s president, points out that while the typical international call runs at approximately US$120 an hour, the figure will be closer to $6 with Net2Phone. What will telephone companies worldwide say about this? "I'm sure nobody likes it, but there's nothing they can do," he says. "They hated the callback business, too." Jonas pioneered the squirrelly and very profitable callback service in 1991, much to the chagrin of telcos that stood to make money in IDT's place.
International Discount Telecommunications won't be alone in the campaign to cheapen international calls. A project called Free World Dialup (www.pulver.com/fwd/), which launched in January and will run through April, is accomplishing exactly what its title suggests: providing people with free links from the Net to international phone lines. Jeff Pulver, one of the volunteer organizers of Free World Dialup, says the project is simply an experiment for proof of concept. Pulver, who also moderates the NetWatch mailing list, a discussion group for Internet telephony issues, adds that he wouldn't mind rattling some chains in the process. "It's the spirit of the Net," he says. Problem is, the Net is also marked by bandwidth limitations that keep Internet telephony quality down - a prime reason telecom execs aren't up at night sweating bullets. Until the arrival of technology that will create real competition, Pulver says, "there's a coolness factor to Internet telephony, and then it just goes away."
Roderick Simpson
[Original story in Wired 3.10, page 140.]
What Goes Up
As its system's launch date and US$3.4-billion price tag loom ever larger, Iridium Inc. finds it still has some serious work to do. Four years after the Washington, DC-based start-up went looking for funds, it has only 50 percent in hand. A junk-bond financing scheme was recently dashed; instead, Iridium will hold a $300 million internal offering, switching tacks to low-cost equity financing, while also opening itself to foreign investments. (Company spokesperson John Windolph asserts that the foreign investments are "not a financing mechanism.")
With FCC license now in hand, Iridium contends things are running smoothly and ahead of schedule. Whether this is true or not, industry experts believe that Motorola will never let the project die an ungracious death.
As Scott Chase, the publisher of Via Satellite, points out, "Motorola is Iridium's international bank of last resort."
[Original story in Wired 1.5, page 72.]
Promo to Go
Sanford Wallace's Promo Enterprises is in some very hot water. After Promo forged a return e-mail address last October, ReplyNet Inc., a Gaithersburg, Maryland, electronic fulfillment service, found its servers inundated with mail bombs and vituperative rejoinders from irate victims of Promo's mass junk mailing. ReplyNet, fearing permanent damage to its reputation, served Promo a Big Foot letter citing "serious violations of state and federal law." Curiously, Promo had also just launched its own "auto-responder" fulfillment service, begging the question, could this have been a deliberate act of spamotage?
The ensuing case could very well be precedent-setting. "It's the first legal battle over spamming," says Stewart Baker, ReplyNet's senior counsel. "But, it won't be the last."
[Original story in Wired 4.01, page 52.]
Script (e)X(it)?
Though Kaleida closed its doors as an independent entity on January 16, some predict it will continue its slow, agonizing decline as Apple takes the helm.
While cognitive dissonance between Apple and IBM is frequently cited by ex-employees as a reason for the company's downfall, another pointed to parental neglect. Nat Goldhaber, former head of Kaleida, contends that the seeds of Kaleida's destruction were sown in its creation. "Kaleida suffered from both a structural and conceptual problem. There were mixed messages and no messages." The parents "wanted a research lab that they could jointly control."
Most agree that a lack of direction at critical junctures foiled the production of a potentially lucrative product. As media team manager Erik Neumann points out, "ScriptX needs care and feeding. Apple is focused on its bottom line - selling hardware, the success of its OS. Management just won't focus on this." Indeed, ScriptX may very well take a back seat, making it questionable whether 2.0 will ever ship. As one former Kaleida engineer who asked to remain anonymous says, "I don't think Apple has the wherewithal or the smarts to pull it off."
[Original story in Wired 1.2, page 36.]
