By Stacey Higginbotham, GigaOM Bandwidth.com and Verizon Communications today signed an agreement that could make it easier for companies such as Skype and Twilio to build out cool VoIP applications and services, as well as set precedent ahead of any regulatory policy on how phone companies charge for VoIP calls. The agreement between Verizon and Bandwidth.com — the fifth largest phone company in the U.S. and the provider behind some Google Voice numbers – Pinger, and other hot VoIP companies that can’t be mentioned, sets the fee Bandwidth.com pays to connect calls on Verizon’s network at $0.0007
In the absence of reform, we believe Verizon and others are looking to put downward pressure on intercarrier compensation in the marketplace. Verizon is disputing rural carrier collection of access charges for connecting VoIP calls while attempting to negotiate deals, including the one with Bandwidth.com, that move the industry toward lower rates.The third implication has to do with the somewhat esoteric world of regulation and telecommunications law. The FCC has never ruled on intercarrier compensation rates for VoIP services, because it has never decided if VoIP is a telecommunications service like wireline telephone or an information service like email. Obviously, folks don’t have to pay $0.0007
With $100 million in annual revenue, up from $85 million the year before, Bandwidth.com is growing well without ever having taken on venture investment. The company, which is profitable, expects to file to go public within the next 18 months, said Morken. We’ve covered the business in December 2009, and I think as an infrastructure provider for VoIP services, Bandwidth.com can sell itself as a credible VoIP platform. Contracts like this only reinforce that legitimacy, although should the FCC declare VoIP an information service, I suppose the contract could become a cost burden other providers wouldn’t have to deal with.Related GigaOM Pro Content (sub req’d):
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