why did telefonica acquire Jajah?

In the flurry of announcements for nexus one at CES, some important announcements did not get the coverage .. one such is the acquisition of Jajah by telefonica ..

I have a theory ..

a) all voice is going VOIP. Already the core network has IP(through IMS). The access network is supposed to get IP through LTE

b) However, voice is the big bottleneck for LTE – hence initiatives like VOLGA and 3gpp voice

c) Now, both of the above have limitations. They will take a while to be ‘global’. Meanwhile the world cannot wait for the telcos to interoperate

d) Now this is where Jajah gets interesting. Jajah has a virtual network through VOIP servers across the planet. As gigaom says

However, Jajah’s struggles didn’t prevent it from building its own virtual network with special VoIP servers across the planet, connected through leased fiber connections. It also connects with various PSTN networks (see map). Think of it as a virtual global phone company that allows it to route calls from one place, say New York, to another like Shanghai, at ultra-low prices.

e) This means – telefonica gets a VOIP network globally and does not need to rely on either Volga or 3GPP voice. It could easily ‘offload’ long distance voice calls to the Jajah VOIP network. This could work well especially for Telefonica’s latam footprint

f) There is also a seperate case for Voice as a platform see visionmobile post HERE

If the above theory is true .. then I think it is a very clever move.

It also shows that VOIP has truly arrived!

Comments

  1. James Barnes says:

    The purchase of Jajah by Telefonica is by no means insignificant. It’s important to note that the “islands of VoIP” that we heard so much about a few years ago are becoming archipelagos.
    To labour the metaphor further, as call origination moves to IP (specifically WiFi) and call termination through DID-to-VoIP becomes more popular, those islands of VoIP might just be an emerging Pangea.

  2. Alok Tripathi says:

    Jajah’s virtual VoIP network and interconnection agreements with various PSTN networks don’t really count much in the Voice over LTE strategy and surely it doesn’t allow Telefonica to not rely on VoLGA, CSFB or IMS/One Voice.
    I find it surprising that a global operator would look at a startup to get core telecom expertise on interconnections and long distance voip.
    There is more to this acquisition than meets the eye. I don’t think anybody has as yet figured it out. Perhaps Jajah was coming out with some key innovations (not publically announced) that attracted the bidders.

  3. Ajit Jaokar says:

    James, Alok
    Thanks for your comments.
    I think this is a complement plan (and not a replacement) for LTE/VOLGA etc ie the infrastructure exists and also the idea of voice as a platform is very powerful and has leverage and the web players are(for most part) driving that agenda. thats my theory anyway! kind rgds Ajit