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Voice Over Internet Protocol (VoIP)

By Samantha Hawkins,2014-12-26 02:12
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    Voice Over Internet Protocol (VoIP) “Crossing the Chasm”

    MKTG 6525

    E-Commerce and High-Technology Marketing: Strategic and Cultural Considerations

    Prepared for Professor Detlev Zwick

    Dante Cardenas Jaspal Dhillon

    Joseph George Aashish Jain

Table of Contents

    EXECUTIVE SUMMARY ................................................................................................................................... 2 INTRODUCTION ................................................................................................................................................ 3 TECHNOLOGY OVERVIEW ............................................................................................................................ 4 ADVANTAGES .................................................................................................................................................... 4 DISADVANTAGES ................................................................................................................................................ 5 CULTURAL AND SOCIAL IMPACT ................................................................................................................ 7 REGULATION .................................................................................................................................................... 8 MAJOR PLAYERS .............................................................................................................................................. 9 SKYPE ................................................................................................................................................................ 9 VONAGE CANADA .............................................................................................................................................. 9 ROGERS ........................................................................................................................................................... 10 YAK ................................................................................................................................................................. 10 LESSONS FROM OTHER TECHNOLOGIES ................................................................................................ 10 RESEARCH IN MOTION AND THE BLACKBERRY .................................................................................................. 11

    Implications ................................................................................................................................................ 13 FUEL CELL TECHNOLOGY ................................................................................................................................. 14

    Implications ................................................................................................................................................ 16 ERICSSON AND 3G ............................................................................................................................................ 16

    Implications ................................................................................................................................................ 16 CONCLUSION ................................................................................................................................................... 17 APPENDIX ......................................................................................................................................................... 20 APPENDIX 1 CUSTOMER MENTALITY AND REQUIREMENTS ............................................................................... 20 APPENDIX 2 SKYPE PRODUCT PROPOSITION .................................................................................................... 21 APPENDIX 3 VONAGE PRODUCT PROPOSITION ................................................................................................. 21 APPENDIX 4 ROGERS PRODUCT PROPOSITION ................................................................................................. 22 APPENDIX 5 YAK PRODUCT PROPOSITION ....................................................................................................... 22 BIBLIOGRAPHY .............................................................................................................................................. 23

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Executive Summary

    Voice Over Internet Protocol (VoIP) is a telephony technology used to transmit ordinary telephone calls over the Internet. VoIP takes analogue audio signals and turns them into digital signals (packets) that are transmitted using Internet Protocol (IP) networks. VoIP‟s advantages

    include low cost, flexibility, and mobility. Conversely, VoIP‟s disadvantages include sound

    quality such as latency (delay), jitter, and packet loss. VoIP has a number of cultural, social, and regulatory impacts that solution providers must consider when marketing their services.

    The major players in the VoIP market in Canada are Skype, Vonage Canada, Rogers, and Yak. Each player has its own separate marketing mix; however the majority are mainly targeting the technically savvy and small business niche segments. Even though the mass market is the ultimate goal for these players, much of their current business is found within these segments. Therefore, in order for the technology to cross the chasm from the niche to the mass market, the industry would do well to learn from other technologies that were in a similar position. For example, RIM‟s Blackberry gives suggestions on how to properly market to your target segment. At the basic level, it is to fulfill user needs and wants. However, it also includes fulfilling needs and wants that are sustainable for the solution provider (i.e. not just a low cost solution). In addition, the Blackberry also teaches VoIP providers the importance of using the purchaser vs. influencer model and the development of key partnerships to increase adoption. Fuel Cell (FC) technology has important lessons for VoIP providers in terms of the marketing message. FC technology shows that in order to reduce the appearance of risk in adopting a new technology, communication, education, and customer involvement are critical. Ericsson and 3G highlight the need for a complementary set of goods for the core technology. Overall, the implementation of these factors is vital for VoIP to “cross the chasm”.

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Introduction

     VoIP is a revolutionary new technology that could bring dramatic changes to the telecommunication landscape. However in terms of consumer adoption, the technology is at a crossroads and it is unknown whether it will be able to cross it. Author Geoffrey A. Moore has defined this crossroad as a “chasm” which has been successfully adopted by early adopters, but

    the late adopters are still left to be converted. The chasm can be described as follows: Figure 1 The chasm

    The set of individuals involved in each stage have their own set of requirements and mentality towards the technology. To get a greater understanding of these customers mentality and requirements please refer to Appendix 1. The purpose of this paper is to give insights and recommendations into how VoIP providers can go about successfully crossing the chasm.

     The paper starts with a technical overview of VoIP which includes the advantages and disadvantages of the technology. The second part highlights the cultural and social impacts and the regulatory issues that VoIP providers have to consider when marketing the solution. The

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    third section gives a brief introduction into the major players in the Canadian marketplace and their individual marketing mix. The next part discusses other “chasm” technologies and the lessons VoIP can learn. Finally, the conclusion gives final recommendations for VoIP providers to take in order to cross the chasm.