Internet phone rising star SunRocket is pushing down the price of VoIP even further while upping the value of the service. The Vienna, VA-based company announced this morning a new global calling plan, called the SunRocket Sunspots Edition, that covers 41 countries, or cities within 41 countries, with unlimited calling for $299/year, or $24.92 per month.
An even more deluxe package, called SunRocket Global Edition, covers high-cost countries, such as India, the Phillipines and the Dominican Republic, for $349/year, or $29.08 per month. As Richard Greenfield at Pali Capital pointed out in a research note this morning, these prices are on par with what Vonage charges (and far lower than typical cable VoIP service, which runs around $40/month), but covers a wider swath of the world.
The Sunspots plan is particularly interesting as the monthly price is virtually the same as Vonage’s core offering, yet it provides unlimited international minutes to a significantly wider array of international destinations than Vonage.Posted by Cynthia Brumfield at 1:44 PM | Print | Comments (0)
Business Week has as its cover story today a fascinating and slightly frightening examination of former spyware leader Direct Revenue. This in-depth investigation of the shameless company, which downloaded without clear user understanding damaging spyware onto millions of computers, provides a scary look into the economics of the web-based direct ad revenue business.
The company, located in a loft above a clothing boutique in New York’s hip SoHo district, has been a pioneer in a seamy corner of the booming Net advertising industry. Although it is small by some corporate standards, having generated sales of about $100 million since its start in 2002, its programs have burrowed into nearly 100 million computers and produced billions of pop-up ads.
It’s no surprise that NY Attorney General Eliot Spitzer filed suit against Direct Revenue in April for fraudently installing spyware programs on millions of computers with the users’ consent. Not only did Direct Revenue surreptiously install software, it also allegedly knocked out the software of rival ad programs by using code developed by a team of stealth programmers called “Dark Arts.”
The team called itself Dark Arts after the term for evil magic in the Harry Potter series. One of the biggest threats Dark Arts addressed came from competing software. The presence of multiple spyware programs can so cripple a computer that no ads manage to get seen.
Dark Arts crafted software “torpedoes” that blasted rival spyware off computers’ hard drives. Competitors aimed similar weapons back at Direct Revenue’s software, but few could match the wizardry of Dark Arts.
Moreover, company executives relied on a dense, 7-page user agreement that most users never saw to justify this interference, saying the agreement was a “lawyer-approved license to kill.”
[Company CEO Joshua] Abram presented the new agreement to his troops with an impudence befitting the Dark Arts crew. “It’s a lawyer-approved license to kill,” the CEO said in a February, 2004, e-mail. He urged some restraint because at the time potential investors were examining the company: “I would think twice about going too aggressively on the offense during [due] diligence.” But he added: “Obviously, if we find someone is slaughtering us in the interim, we should not wait to counter.”
What is even more stomach-churning is that Direct Revenue had some blue-chip investors (including Insight Venture Partners, which pumped $27 million into the company) and some high-profile clients, including JPMorgan Chase, Delta, and Vonage. But users were nothing short than enraged by Direct Revenue’s tactics, sending death threats and profanity-laced emails to the company.
Sifting through a stack of customer complaints in June, 2005, a Direct Revenue employee decided to tally the most frequently used words of aggression: “die” (103 times), “f———” (44), and “kill” (15). Douglas Kee, then Direct Revenue’s chief of quality assurance (QA), ribbed colleagues in an e-mail that with all the death threats, it was a “good thing QA sits farthest away from the entrance.”Posted by Cynthia Brumfield at 9:44 AM | Print | Comments (0)
For those of us who have been watching AOL sink deeper and deeper into non-sensical gambits to right its listing ship, today’s New York Times piece by Saul Hansell is just more evidence of the chronic flailing characteristic of the online giant. As the WSJ reported last week, AOL is indeed eyeing a strategy that will pull the plug on its premium service in favor of concentrating resources into building up advertising revenues with a completely free service, a la Yahoo.
In two weeks, the board of Time Warner Inc., which owns AOL, will hear a proposal from Jonathan Miller, AOL’s chief executive, calling for a near halt in marketing for AOL’s 17-year-old Internet access service, price cuts for existing customers and thousands of layoffs. His goal is to devote all of AOL’s energy into building its free Web-based services.
However, the prospects for suffering short-term subscriber revenue losses in favor of long-term ad revenue growth are tenuous at best.
The investors who have looked at AOL’s advertising performance so far have not seen a clear picture of a turnaround. Last fall, the company started promoting the free AOL.com, which featured most of the content it had offered its paying subscribers. AOL says 35 million nonsubscribers have used the free site. But it has not replaced the traffic lost from subscriber defections, because subscribers view many more pages than nonsubscribers. And each page, of course, is an opportunity to display advertising.
Time Warner, of course, is stuck — AOL is sinking fast no matter what, so some way of dealing with the problem has to be developed. Still, as Merrill Lynch analyst Jessica Reif-Cohen notes in Hansell’s piece, it’s way past tiresome to read of yet another turn-around strategy at AOL.
Ms. Cohen of Merrill Lynch said she had lost count of AOL’s various revival plans.Posted by Cynthia Brumfield at 8:20 AM | Print | Comments (0)
“This one seems to make sense,” she said, “but so did their other strategies.”
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