The VoIP Business: Is It Here To Stay? A Case Study of Deltathree, Inc.
Date Issued
2010
Date
2010
Author(s)
Karnovsky, Naomi
Abstract
Voice over IP has been in use for over a decade, and while it is no longer in the frontline of technological innovation, it has played an important role within the telecommunication industry, as a new mean of communication. The VoIP business has succeeded mostly by providing an affordable alternative for long distance calls. However, as many competitive elements within the market continuously push margins down, VoIP providers are beginning to look for new strategies that will allow them to continue growing. Furthermore, as VoIP technology is gradually nearing its technological limits and is threatened by another discontinuous technology, the question is whether or not it has already fulfilled its potential, and how VoIP companies should play their cards in order to remain relevant and continue growing.
This study aims to identify the stages of the VoIP technology evolution, in terms of its technological performance and market adoption, to understand its current position. It also aims to identify threatening technological discontinuities, and through an analysis based on the theoretical framework of technology s-curves, reach a conclusion regarding the future of the VoIP business as well as formulate a strategy that will extend the technology’s life cycle. The approach taken in the research is observation, done through analyzing a VoIP pioneer provider, Deltathree, Inc. as the object of a case study. The research is based on collecting information through several interviews with key managers of the company, conversations with different personnel, and reliance on internal documents, annual reports, and press releases, as well as external information such as news reports and technological articles.
The results of the case study analysis and suggested strategy are then taken into a broader context and applied to the overall industry. The research also takes a further step and provides some insights to the applicability of the results and recommendations to other industries, namely the ISP and film industries, which are similarly based on a technology that is gradually exhibiting a slower rate of improvement and is threatened by another disruptive technology. This larger context provides a basis for a strategic framework that can be used in different industries under similar circumstances.
Subjects
VoIP
IP Telephony
S-curve
technology performance
technology diffusion
Type
thesis
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