Monday, June 8, 2009

Jaxtr, Free voice calling service bites the dust?

Jaxtr, the VoIP widget company, has been acquired by Sabsebol, a free conferencing startup. (Hotmail cofounder saber Bhatia is behind the startup SabseBol) To me it looks like a firesale. I have always been critical about jaxtr revenue model. Free model doesn’t work. Voice 2.0 is not about giving away free stuff, it’s about innovation. The irony is that sabsebol has been around less time than Jaxtr. So Is this a good news or bad news. Depends on how you see the deal, Good that the technology and some folks will be saved from disaster. Bad that another startups bites the dust in the Voice 2.0 arena.

Venturebeat talks about merger between Jajah and Jangl, which is not Completely true . There was no merger between jajah and jangl. It was the demise of jangl that triggered the acquisition of jangl’s technology and hiring of some key folks.

The concept of Call-me-Widget for blogs, social networking seemed like a huge idea. Alas, there was no revenue model around this cool idea. Jaxtr, for instance, had raised more than $21.5 million dollars. So where did all this money go? It was all used for supporting Free international calls. I’m guessing they ran out of money and the inevitable happened. The fundamental business model behind free service is weak. The users who like free service will always look for free service. Free doesn’t generate revenue. I have written about jaxtr and their business model many a times in the past. Check out these links here and here.

I still don’t see a synergy between a free conference call provider and call-me-widget startup. To me, it looks like the deal is all about the 10 million users that Jaxtr has amassed all these years. And Maybe, sabsebol wants to penetrate social networking arena. It will be interesting to see if sabsebol will continue to provide free international calling.

I hate to write sad things about Voice Startups. Will I ever get to write about a Voice 2.0 startup that really makes it big? Please no skype; there are enough folks out there to rave about them. Maybe ifByPhone, Jaduka, Voxeo, Iotum,Phweet etc. What do you guys think?

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2 comments:

Eric Eldon said...

Hey there, Eric Eldon here from VentureBeat. I wrote the article about Jaxtr today that you linked to. There was a merger of sorts, although you're right about its outcome. First Jangl and Jajah formed a strategic partnership (http://venturebeat.com/2007/11/15/jangl-and-jajah-once-rival-web-calling-companies-join-forces/) then Jajah absorbed some Jangl assets and employees (http://venturebeat.com/2008/05/07/internet-phone-company-jangl-to-sell-assets-core-team-goes-to-competitor-jajah/)

omfut(Ravi) said...

Hi Eric:
Thanks for the comments. I guess it was the demise of jangl that triggered jajah's poaching most of the key guys. Either way good for the jajah and jangl. BTW, jangle co-founder has moved on and started a new venture called CC. Betty http://www.ccbetty.com/. Wish him all the best for the new venture.