Distributing

One thing that the VoIP Providers seem to want is Distribution. How does a VoIP Provider get his device into the hands of the consumer?

Vonage spends millions on advertising and has deals with retail outlets like Amazon and Circuit City. Skype has devices on Amazon and other outlets. (It seems like Amazon has an affinity for VoIP providers, including Magic Jack and Ooma.)

Now Ooma is a strange deal. There has been a lot written about Ooma (here and here and here)  Sharing a PSTN line seems like no way to save money. If you still have to pay for the landline, why buy Ooma? To save on some long distance? Most people don't spend more than $20 per month on LD. Someone must believe in the deal because even after staff was cut and execs fled Ooma, the company was able to raise $16M.

The key for any of the VoIP players is scale. Distribution is one way to attempt to achieve scale. Some use an Indirect Sales Channel; others try to get inside the distribution network of Tech Data, Amazon, or a bog box outlet. (That's an expensive proposition.) But how else do you reach the masses except through a multi-million dollar advertising campaign? Or running hundreds of infomercials?