Resellers Blaze The Trail In Emerging Markets

For those who have been in the telecom industry for a while, VoIP seems like it’s been around quite a while and, in “telecom years”, it has. It’s sometimes easy to forget that even in the U.S. a large majority of consumers and businesses have not yet converted their voice communications to VoIP. In emerging markets VoIP is just beginning to gain a foothold. For businesses that want to capitalize on the largely untapped opportunity in emerging markets, distribution can present significant challenges.

While the market leaders in many emerging markets are standing on the VoIP sideline, many resellers are having significant success. The opportunity in emerging markets is huge. Frost & Sullivan reports that VoIP generated $72.3 million in revenue in Latin America in 2007 and they estimate growth to $625.9 million in 2012 – that’s 150% annualized growth. Interestingly some of the business models having the most success in these markets are quite different than the models that are having the most success driving VoIP in the U.S. and other developed markets.

• Calling cards are a $3 Billion business in the U.S. but they aren’t mainstream. In emerging markets calling cards are very widely used. Many resellers are finding lots of opportunities to compete successfully with the bigger players. They key, they find, is to offer quality and value that can gain word-of-mouth to combat the expensive, flashy marketing that the big players can afford. VarPhonex is one of the leading providers that enables these resellers by delivering a product that is reliable and straight-forwardly priced.


• Phone shops are a popular and growing business model in emerging markets. Many consumers in emerging markets do not have the access to a home phone line or broadband Internet service that we in the U.S. take for granted. Phone shops essentially allow a community to share a broadband connection on a pay-per-use basis. Successful phone shop operators need a VoIP provider like VarPhonex that can support them in three respects:
  
  
  1. Allow them to deliver products that can be quickly and completely customized since the demographics of the neighborhood surrounding one phone shop can often be unique and competition with neighboring phone shops can be fierce.
  
  
  2. Provide them an interface that they can use to sell the way phone shop customers buy – without forcing them to spend money on complicated, and often unsupported, call shop management software.
  
  
  3. Give them the ability to deliver great value: quality and low cost. This requires a supplier that constantly and aggressively monitors and manages transport and termination providers.

Multi-level marketing, a business model that has seen limited success and significant controversy in the U.S., is a big hit in emerging markets and it makes sense. Multi-level marketing is all about empowering early-adopting influencers to monetize their relationships. VoIP is new and nothing overcomes consumer confusion and trepidation like a face-to-face dialog with a trusted, knowledgeable person. These resellers are often experts at building and maintaining networks of contacts but not at managing the technical and administrative aspects of selling VoIP. These resellers have found that VarPhonex is a supplier that can support them with a powerful platform and a team of technical experts to help them sell to and support customers.

VoIP, particularly in emerging markets, is a tremendous opportunity for resellers and the next 60 months represents a significant and sustained opportunity to capitalize. Resellers that choose a strong partner, like VarPhonex, and an effective distribution strategy have a high likelihood of considerable success.

Improving Quality By Reducing Distance

VarPhonex is proud to announce a new capability that can improve voice quality in a big way. The technology we are using is called “Media Release”. It works by reducing the Internet distance between the caller and the called party. As it is in the real world the shorter the distance between 2 points, the faster it is to get from point A to point B and this is also true on the Internet. It so happens that, if one has sufficient Internet bandwidth, short “Internet distance” helps VoIP quality and reliability.

VarPhonex proxy servers are located mainly in the US and we have VoIP POPS globally located. In the past, this usually meant that all calls passed through the US based servers first and then to our VoIP POPs. Using the Media Release technology, not all calls will need to pass through these US based proxy servers. For example, if someone is in São Paulo, Brazil and is calling to Rio de Janeiro, Brazil, via VarPhonex, the call will not need to pass through our proxy servers in the US and then go back to Brazil to be completed. Instead, the call will go directly from São Paulo to one of our POPs in Brazil and then to Rio de Janeiro. Essentially the call travels a far shorter distance, thus increasing voice quality and reliability.

The requirement is that the caller’s IP phone device or server is on a public IP and not NATed (private IP). If this condition is true, media release will happen all the time.

Please contact us if you have any questions and please set all your IP phone devices to public IP instead of private for better use of our world leading IP Telephony service.

Free 411 Now Available!

We are proud to announce that VarPhonex customers can now dial 411 to receive U.S. residential, business, and government directory assistance at no charge. Many long distance and wireless companies charge $1.50 to $3.50 per call for dialing 411. In order to provide this valuable service at no charge, callers who dial 411 will hear a 10-second message from an advertiser prior to getting the listing they need. The listing will be spoken to callers or sent as a text message to their mobile phone. With VarPhonex, you never need to pay for 411 again!