Tuesday, February 14, 2012

Ooma Revisited - Now in Canada, and in HD!

If you’re new to my blog or the VoIP space, you may not know Ooma. On the other hand, if you go back far enough with me, hopefully you’ll recall I was one of the first to trial Ooma as well as write about them. The VoIP space has evolved since then, and while my early posts were not optimistic about Ooma’s prospects, that view was balanced by their strengths, which I believe have served them well to survive into the present.

Two things in particular stood out for me, especially compared with OTT services. First is voice quality, which I feel has always been better than any other VoIP service I’ve used; with Vonage, Primus and Skype being my primary reference points. Second is how they’ve packaged the offering – notice that I didn’t call it a product or a service. That’s where I think they’ve done a good job – they’ve managed to productize VoIP by tying it to an end device you buy in a store.

Ooma is unique that way, and their slick packaging and product design really does make you think of Apple. That’s definitely a plus in my books – not just because it makes you feel good about dishing out the cash up front to buy Ooma, but also because you’ll be more likely to recommend this cool-looking/cool-sounding thing called Ooma to friends/family, which is a pretty important driver for their growth.

Being an early adopter, I could go on about the product-based elements of Ooma, but this post is tied to more current events that I think need some amplification. First is the fact that Ooma is now offered in Canada. When I was invited to trial Ooma, the service was strictly U.S.-based, and being in Toronto, they could only assign me a DID with a U.S. area code. Last November, their Canadian service was launched, so in addition to my initial Ooma number, I now have a second number with a Toronto-based area code. Due to my long and unique relationship with Ooma, I’m pretty sure I’m the only Ooma user in Canada to have this setup with two inbound DIDs.

I haven’t posted about this until now for a few reasons. Aside from being busy with projects and conferences, I didn’t actually get my Canadian Ooma number until recently; plus, I wanted to spend some time using the service with both numbers. On that front, I can say that the call quality has remained great, and now they tout Ooma’s “HD-quality”. That moniker didn’t exist a few years ago, and I’m glad to see them using it as a differentiator. I say that for two reasons.

First, consumers need to understand that VoIP can actually be better than TDM, and at minimum, they must perceive that quality will not be compromised when switching. Today, this actually applies to two scenarios. The main one is switching from their incumbent where they’re going from TDM to VoIP, but there is also another market opportunity in play here – VoIP subscribers from other services. I find the latter a more interesting scenario since there are so many options available. Most are OTT, and being run over the public Internet, quality can be highly variable. In my experience, Ooma doesn’t have this problem (you should read up on their peer-to-peer architecture on their website as a starting point to understand why), but there’s another factor to consider as well.

Most VoIP services have no contracts, so switching costs are basically nil. This plays nicely into Ooma’s value proposition, whereby your only cost is the roughly $230 upfront layout for the Telo box. You can add some higher-end features, but the basic service is free from that point on, so knocking out the $30+ monthly cost of an OTT VoIP service should be a no-brainer.

The second factor that makes HD attractive is the comparative quality against mobile calling. You may rightly ask "who the hell uses a landline these days, dude?", but bear with me. I know people like this have very short attention spans, but put your so-called smartphone down for a sec and read on - you might actually learn something.

When Ooma first came out, mobile wasn’t as entrenched, but today, it’s really killing all forms of landline telephony. Fair enough – even I concede that mobile will eventually rule – but there are still tons of landlines out there, and in the overall scheme of things, Ooma is still a pretty good deal to have as your backup service at home. It’s more economical than TDM, and with HD, the calling experience is way better than any mobile service or on any "smart" phone. For people who routinely use their mobile phones at home – I have never understood the logic there – I’m sure they would revert to landline once they experience how good Ooma sounds in comparison.

My main message here is to get the word out that Ooma is now available in Canada. The service has been available since November – and yes, it has 911 – with distribution where you’d expect to find it – namely Best Buy, Future Shop, Canada Computers, London Drugs, select Costco locations, and Amazon.ca. As their website shows, some of these channels are in-store only, some online only, and for Costco, both options exist.

VoIP has gained more traction in the U.S., namely because there are more offerings, and of course, Vonage created awareness with its mass market advertising. We got a little of that in Canada, but not much, plus the incumbents have had a pretty good hold on the market. That’s been changing, though, as cablecos have made big inroads with VoIP, and with the recent addition of new wireless players, mobile adoption has been growing – but still lags the U.S. As such, there’s still good upside here for VoIP, and while Ooma has a distinct offering, I believe there’s an appreciable segment of the market that will see value here.

There’s one more thing to add to strengthen this story. More recently – at CES last month – they announced their HD2 cordless handset. I think call quality is the killer app for Ooma, and to maximize this opportunity, you need the right handset. Existing analog or digital home phones will work just fine, but you’ll need HD2 to get the true HD experience. Just like watching HD TV for the first time, once you experience this, it’s hard to go back. Of course, this also gives Ooma another product to sell and adds to their top line revenues, but it makes the service stickier. A top quality audio experience is the best way to keep Ooma customers, especially those who live on their wireless phones.

Not only that, but HD2 takes VoIP beyond free phone calls. The phones have a 2” color screen, which shows photo caller ID. Now the experience starts to feel more like a mobile call, plus there’s a social media tie-in by supporting Facebook profile pictures as well as displaying contact lists from IM platforms like Google and Yahoo. That’s pretty key, since happy Ooma users can now use word-of-mouth virally. I’ll take that path any day over expensive TV advertising to acquire customers as cheaply as possible.

Before you get too excited about this, though, we are in Canada after all. HD2 will be available in the U.S. next month, but won’t likely be in Canada until the spring. Just be a little patient, folks, but your time will come too in the Great White North. Hopefully, the takeup will be good, and I’ll revisit Ooma once there’s time to gauge their success. Until then, drop me a note if you’d like to call either of my Ooma numbers and experience it first-hand. I’ll be happy to oblige!


Alf said...

Thanks for this article, makes a lot of sense. We have a florida property and I've had OOMA in there for over a year. We had some issues at the beginning, but they have all settled down and it works great. I love the service.

You have given me the idea to get another OOMA in canada and get rid of my cable VOIP. THanks.

In case you don't know, there is a known problem with FAXing over OOMA so if someone needs fax capabilities, they will have to find another solution.

I just scan and email instead right now.

Thx again

Anonymous said...

My 1st Ooma experience was flawless. I subsequently bought 2 Ooma devices for 2 different vacation houses. I registered each phone number, to be ported, to each unique MAC ID/device. Ooma ported both of my numbers to 1 device only. I tried to get them to straighten this out and they seemed incapable of even understanding what had gone wrong. I am now awaiting prepaid return shipping labels and assurance that I will be reimbursed for all expenses including the reporting of my phone numbers back to Verizon. I have filed a formal complaint with the FCC. I have had good luck with this agency’s ability to resolve issues. I will update this as needed.

Jon Arnold said...

Thanks for sharing that, Anonymous. You can't win 'em all, and am sorry to hear about your problem. You take the good with the bad with blogging, and invariably I'll get comments like this, but I can't take this any further. Am sure you've had your share of correspondence with their customer service people, and hope it gets resolved soon.

Anonymous said...

My NetTalk Duo has been disappointing in terms of call quality. Also its features are inaccessible from Linux forcing me to use a Windows VMware image (the only way Windows would ever be allowed on a professional box!) just to get voice mail messages.

OOMA costs about 3x more than NetTalk Duo or MagicJack Plus and I don't understand how it can expect to route calls forever and ever for $0/year if you don't buy Premier - though I can see a lot of people buying Premier for Google Voice connections, etc. In Canada which has Google Voice restrictions, even more reason to buy OOMA.

There is no cordless handset that compares to the Panasonics, so the OOMA HD2 is worrisome - will they be properly supporting touchtone or other codes from popular phones if they're trying to hock this thing?

The HD2 handset documentation that I can find is very bad, it doesn't for instance verify that there's a 2.5mm standard corded headset jack on the thing (absolutely mandatory for any serious user, handsets without that are worse than junk). There does not appear to be one at
and (almost as bad) it appears to be a proprietary battery, not AAA rechargeables like the Panasonic.

It doesn't appear OOMA is talking to business users in their ads or documentation. They mention such features as facebook pictures etc.

Would like to see some independent review from people using it with a proper Panasonic cordless phone and using some OS other than Windows.

Jon Arnold said...

Thanks NetTalk. Thoughtful comments here, but too technical for me to reply to. It's also not the place here to get into that level of detail.

However, if you want some answers, I'm happy to put you in touch with the Ooma folks, as they have some thoughts about this.

inlinecom said...

Thanks Jon for sharing this information and your short HD video is very nice and this technology is only useful for only smart phone.

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