When I last caught up with Ooma in New York I had a chance to learn about their slick new Telo device which looks like a blend of art and communications. I have always been a fan of Bang & Olufsen products – they are some of the best designers of stereo products on the planet. I was not surprised at all to see some B&O products at Ooma headquarters when I visited last week. They can be quite inspiring. In fact, the Telo could pass as a B&O device but you can detect that B&O would have made it a bit more artsy and less functional.
Ooma Telo in all its video glory — a live demo from Ooma HQ
click Play button above to play video
Some important details regarding Ooma are as follows. The company sells a device for $250 (or whatever the retailer charges up front and provides free US phone service from that point on). International rates are similar to Skype. One really interesting stat is their Premier Telephony Package which adds a second line, three-way conferencing and Multi-Ring (Find me, Follow-me), black list and more is chosen by 28% of customers. At $12.99/month or $99.99/year it seems like a good value.
More recently as municipalities are looking to tax anything they can, have found VoIP to be a tempting target and as such Ooma may be forced to charge users monthly taxes. This could amount to less than a $1 a month according to Rich Buchanan CMO and Tami Bhaumik VP Corporate Marketing.
The company expects to be profitable by the end of the year and they have seen their retail presence grow dramatically from Amazon being their sole distribution source a year ago to 5,000 retail stores today. They are also in 100 Costcos – this started as a trial in only 20 stores. They tell me this relationship has been successful so far.
Telo comes out this Fall and the mobile devices are not required but I suggest them if you want a slick looking phone that can take advantage of data-driven features like sending SMS and assigning MP3-based ringtones. The one downside to these mobile phones is they have black and white screens – but for $50 there is still a solid value here.
HD voice is included as well so you are talking about a high-quality solution with a slick interface.
On a more technical note Telo is powered by Mindspeed Technologies dual core processor running Linux and FreeSWITCH meaning we can see this offering morph (and this was confirmed once again in our meeting) to be a capable SMB solution in the future. Another benefit to using the service is it uses a secure tunnel to communicate with Ooma servers meaning no ISP snooping is possible with DPI or using other means. This sort of solution is the perfect arms race product for consumers in countries where governments use DPI to crack down on VoIP users. And this is happening more and more as DPI companies I speak with tell me about the roster of middle-eastern telcos who are customers.
Buchanan and Bhamik told me their devices are selling nicely to families with relatives outside the US and as a side benefit, relatives living abroad get a US number for domestic friends and family to call.
When we discussed the change in user habits as it comes to landlines Buchanan told me consumers see their service as an IP communications device for the broadband age meaning it is not considered to be a landline but instead a new-age IP-based service.
In addition for features like 911 he says Ooma is preferable to mobile phones where you may be connected to a police officer and have to spend time explaining your exact location in the case of an emergency. This leads to the idea Rich mentioned which is if you have kids you want a landline for safety and again superior 911 service.
Anytime a company is able to break into a saturated industry like consumer voice with a new way of doing things it is impressive to me. Time will tell if a slick interface and hardware design coupled with free phone service makes for the killer device this holiday season but if consumers are still looking for hot-looking products which save them money, Ooma’s Telo could be a hit this holiday season.