Dedicated-line VoIP: Speakeasy puts money where its mouth is

If you're going to offer a true alternative VoIP service, you better make sure you take responsibility for the customer experience, says Bruce Chatterley, president and CEO of Seattle-based Speakeasy. For all of the hype surrounding VoIP this year with new entrants popping up on a daily basis, Chatterley is confident that this dedication to quality will give his company a leg up on the competition.

"We're initially only going to offer VoIP in combination with a Speakeasy broadband connection, and we think that's important because the only way we can manage QoS end-to-end is if we control the connection," said Chatterley. "We believe that by doing that we're going to offer a much higher-quality user experience than companies like Vonage that just plugs their VoIP feature on someone else's connectivity and can't manage that connection."

When Speakeasy asked what customers would want in a VoIP service, there were four main fundamentals: quality/reliability, cost, single bill/single support and new features, with quality and cost being at the top of the list. To keep its promise, Speakeasy has built a dedicated, private fiber-based network backbone via its partner Level 3, which includes eight major U.S. local POPs. In the last mile, Speakeasy has a direct connection into local provider partners including Covad, Qwest and SBC. This is then combined with its VQ Technology, a managed QoS mechanism that prioritizes voice traffic over data traffic. A customer could, for example, be simultaneously downloading a file while on a VoIP call without any degradation in voice quality.

In addition to controlling QoS, Speakeasy provides true 911 and enhanced 911 services with the same PSTN reliability customers have come to depend on. Whereas other providers utilize an administrative interface for 911, which generally does not have the calling address for the person, Speakeasy's 911 service is integrated with local Public Safety Answering Points in each market that provide name, address and phone number information to deal with emergency calls.

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To power up its VoIP and naked DSL service sets, Speakeasy has enhanced its partnerships with Level 3 and Covad. Speakeasy will offer its OneLink service by leveraging Covad's dry loop, or dedicated DSL lines. For VoIP, Speakeasy will utilize Level 3's HomeTone VoIP service, a wholesale turnkey VoIP service that combines the relevant building blocks (911, directory assistance and operator services) of its VoIP Enhanced Local service with Class 5 softswitch capabilities. In addition, Home Tone offers enhanced unified messaging and find me/follow me features. Speakeasy will take those features and package them under its Speakeasy Voice for residential and then business customers.

"It was logical for us to partner with Level 3 because they are focused on wholesale, and we're confident that they won't compete with us," said Chatterley. "The other thing is that their whole core competency is to organize their whole business, operations and support around providing wholesale services that we can add value to and differentiate in the market, so VoIP was a logical extension of our relationship. Because our private fiber backbone is a sub partition of their national network, their VoIP application server sits on the same network as us, so from a latency and QoS standpoint we get a benefit there."

Although the traditional landline phone will be with us for a long time to come, the two biggest drivers toward naked DSL and VoIP are wireless phone substitution and those users that want to use VoIP instead of traditional PSTN service. Cellular users are prime targets for naked DSL and VoIP services because they both offer a flat rate and unlimited usage. In fact, Forrester Research estimates that approximately 2.3 million U.S. households will replace landline phones with a wireless phone by 2006. Then, there's a growing population that are not only substituting their landline phone with wireless, but also wanted to break ties with their phone company. On the business side, it's the desire to get a dedicated data connection with five-star support.

Speakeasy Voice service will be compatible with its existing cadre of DSL and T1 service packages, including its naked DSL service. When combined with its naked DSL service OneLink, which does not require a user to purchase a phone line, a consumer or business can effectively break ties with the traditional phone company and get a single bill of flat-rate, unlimited voice and data services. As an added caveat, cell phone users could use OneLink for their DSL data connection, or choose a hybrid that connects their cell phone with OneLink DSL plus VoIP with find me/follow me capabilities.

While the initial drive for Speakeasy Voice will be residential, Speakeasy does intend to offer the service to its SMB customers. Speakeasy has been targeting the budding SMB market via a growing cadre of independent IT consultants, a channel that Chatterley believes is a gold mine of opportunity. To maintain customer responsiveness, Speakeasy assigns a dedicated business manager for the life of the account. Such a structure gives this market a direct link into a person that knows their account.

"When it comes to our customer targeting, we try to target the most valuable segments that are not well served by what I call the McDonalds-quality carriers," said Chatterley. "We're serving on the business side through a unique channel that no one has been able to tap into yet. They are not going to make a living off of selling our stuff in terms of commissions, but what they want is a company they can work with where they have confidence that it's not going to degrade their relationship with the customer, and be able to immediately resolve issues."

But even as Speakeasy reaches about 92 percent of the U.S. market with DSL, the company is not resting on its laurels. After receiving a strategic funding from the Intel Communications Fund, Speakeasy recently began initial testing of broadband WiMAX with business customers in Seattle. The operator chose Seattle as the test city because of its rough terrain and strong demand for broadband services. Initially offering a 3-Mbps service, Speakeasy will also offer a dedicated account manager and SLAs for mission-critical applications.

Sean Buckley, Senior Editor

Sean Buckley is senior editor at Telecommunications[R] magazine (sbuckley@telecommagazine.com).

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