RUMOR: Apple Buying VoIP Provider iCall
Posted on December 14, 2009 by eli courey
This would be, in my opinion, a very good decision for Apple. I think that all phones will eventually be based on VoIP, and if Apple purchases iCall, this will help them be ready for it if and when they decide to take that path.
Apple is flush with cash, and as it looks like we’re coming out of the recession (fingers crossed!), it’s in prime position to make some acquisitions. Last week, Apple purchased music startup Lala, for example, and it was sniffing around mobile ad network AdMob before Google acquired it.
So what will Apple buy next? One reader just sent us a message that Apple is in talks to acquire VoIP company iCall in a $50 million to $60 million deal.
Is this true? iCall co-founder and CEO Arlo Gilbert, reached by phone, would not confirm or deny any talks, but that’s the response he’s supposed to give us. We have not yet heard back from Apple. (Anyway, everyone talks to everyone, so it’s worth discussing.)
So, should Apple buy a VoiP company — the way Google, increasingly a rival — has acquired two? (GrandCentral, now Google Voice; and recently Gizmo5.)
For its long-term strategy, it makes sense for Apple to at least have a VoIP product available — even if only for defensive purposes, even if it never launches.
In the short term, it would probably piss off Apple’s carrier partners, which sell the majority of Apple’s iPhones, and currently make the vast majority of their revenue by selling voice phone service. But for Apple’s longer term strategy, it is a good idea.
Why? It’s obvious to everyone but wireless carriers that wireless carriers are increasingly becoming dumb pipes. People are sick of carriers’ ridiculous fees and policies, and just want a good device that can connect to the Internet and make calls.
As data networks evolve, it will be possible to make calls as well over the Internet as by using a voice network, and cheaper. (It’s already getting there.) And that’s when Apple may seek to increase its control over iPhone owners — and recurring revenue from them — by becoming a VoIP service provider. Moreover, as that becomes a bigger industry, Apple should not give that business to Skype, Google, or anyone else.
So for that long-term interest, Apple may already be hiring (or acq-hiring) today.
iCall has more than 100,000 iPhone users, its CEO tells us, so it already knows the business pretty well. It also owns the trademark to “iCall,” which Apple may or may not want to own. And perhaps it has executives and/or technology that Apple could want.