Telephones over the Internet, a Skype vs Gizmo5 comparison

Engineers are always trying to optimize value - sometime's we choose the wrong values to optimize on, but thats a discussion for another day. Recently, I've been looking through different VoIP services to see how viable they are as ways of augmenting or replacing my residential land-line phone service. VoIP is Voice over Internet Protocol. The per-minute prices for VoIP are free-to-low, with direct computer-to-computer calls typically free and computer-to-phone service typically at a low monthly or per-minute fee. A computer-to-phone call is often called PSTN or Public Switch Telephone Network termination. There are also other variations on this where you call and the service calls back but, for me, those services are more hassle than they're worth.

VoIP phoning isn't as reliable as regular landline phones. e.g. in a power outage, you have to have your own backup to run the computer or other devices needed to connect to the internet -- and even that is futile if you net connection goes down with the power. Between the power and issues about getting correct 911 service, etc, VoIP is something I see as a way to augment my current service by reducing cost for non-emergency calls.

So far, after looking through a number of different options, Skype and Gizmo5 are two services of interest. They break up their costs in different ways, and there are various technical and market aspects that might make one favor one vs another. For example, I like that Gizmo5 uses standard communication protocols to initiate and transfer calls while Skype uses more proprietary methods. They also both offer other services that I wouldn't use very often, such as video chat.

Incidentally, one thing that both work with is my Ipod Touch 2G. An Ipod application called "Fring" allows calls over WiFi using a number of VoIP services. It's a geeky feature to play with but there constraints there that make me think that this won't be the way I put the most hours on a VoIP service. More on that later maybe, but I'll just close out talk of Fring with the statement that it's use of standard protocols such as a SIP VoIP interface is what allows Gizmo5 to work with Fring. This is one reason to like standards

As of this writing, both offer service-to-service calls for free. So really I'm comparing the cost of making computer to phone calls. Gizmo5 offers bridging calls to Skype for a flat fee for time. This seems somewhat unreliable, presumably because Skype doesn't encourage this. Skype has a larger user base, but is owned by questionably consumer friendly Ebay (also owner of PayPal).

In terms of flat rate service, Gizmo5 offers 1.9 ct/min rates while Skypes are 2.1ct/min. Skype also charges a connection fee of 3.5 cents. So for flat rate service Skype loses out pricewise. Skype, however, also offers unlimited calls for $2.95/mo. So the breakpoint is ~155minutes for Gizmo5 vs skype. Meaning if you plan to consistently use more than 155 minutes a month on a service like this then Skype will be cheaper. Since this is an addon side service, I think I'm going with Gizmo5 - I liked their use of open connection protocols anyway.

Since I first wrote this post the LA Times ran an article on a study citing the average cost that consumers pay for cellular service -- over $3 per minute wow...

(photo by: asdelwood, under a Creative Commons license on Flickr)

ATT U-Verse vs. ?

About a year ago ATT started rolling out U-Verse in my neighborhood. Since then, every quarter or so, I get an ATT marketing visitor to my door trying to sell me the service which is, at its full glory, a combined phone-internet-cable service. (and I think, is fiber-optic to some sort of neighborhood box, but not to your house). Today was the latest visit, but the first marketer was the worst, they didn't know any details about the service except is fiber-optic and really great. They didn't know what channels they deliver, they didn't know the up and down speeds of the net connection, they didn't know the price of the accounts after the "promotional period" was over. Somehow they were trained to expect such exitement over the phrase "fiber-optic" that they could instantly sell the new U-Verse service. Oh, that and combined billing. I really really don't care about combined billing. I care about what I actually get for my money.

Since then, things have improved a little. At least the reps know the very basic details of whats offered, like what is the actual speed of the network link that I get. Still when the ATT rep shows up at my door again, and we talk about the detals beyond "its fiber-optic and it's great", I find again and again that for the services that I care about - all three categories are more expensive then my current services. Maybe I'm just an uber-consumer.

Actually, I think the fundamental problem is that ATT doesn't understand that I'm a telecom Luddite. My landline service is basic with no additional phone services like caller ID, etc. My cell phone is pay-as-you-go. Between the barebones local-only ATT account and my third-party long distance company, my family and I make basically unlimited calls for a combined 20-35 a month. The ATT price would be $30/mo. I only very occasionally break $30 a month so really ATT loses here.

My net connection is a third-party DSL provider at $20/mo for 3Mbps down and 768kbs up. ATT's rep today claimed 3Mbps down and 1 Mbps up (their website claims 512bps up) for $30/month, or for $20/month I can get 768/384 kbps. Either again the shiny fiber-optic almost-to-the-home service loses again. The ironic thing here is that ATT supplies the underlying DSL connection here either way, but can't seem to keep from offering pathetic value for internet connections.

Finally, I'm also a cable Luddite. Dish Network charges about $35/mo for local channels and a number of basic cable channels. It's pointless comparing the actual number of channels between a given ATT and Dish plan because it would inevitably end up with a race bewteen who offers more QVC or Jewelry TV shopping channels. ATT's U-Verse service starts at $54 a month. My family already watches as much programming as they have time for, and with a Netflix account, we what whatever piques our interest. Maybe that makes my family post-telecom consumers or something like that. I value the Netflix service more than I value a higher tier cable service, but if I added that cost in, ATT would come in at $4/mo higher. Still U-Verses loses again to the tune of $4 to $20 a month.

So for me, U-Verse offers no reason to pay more per month for about the same service. Maybe U-Verse offers some value to people paying for more premium services that I care to get, but until ATT offers some better value to this customer -- well, I guess I'll see them in three months.

Etch-A-Sketch Patent

Here's a link to the patent for Etch-a-Sketch - originally called the GrandJean Tracing Device on Google Patents.