Consumer VoIP startup Ooma launched nearly a year ago and offered consumers free phone service for life, all you had to do was buy the hardware for $399.
Just one problem. The sticker shock of paying $399 up front for the hardware put a lot of users off. And there weren’t many places you could actually buy the Ooma. It went on sale on their website in August 2007. When a number of key executives left the company (we grabbed Sarah Ross, their former VP Communications), some blogs said they were in big trouble.
Amazon started selling Oomas later in the year, and customer reviews are overwhelmingly positive.
A year later the company is still going. They added marketing executives Rich Buchanan to the team from Sling Media earlier this year - the guy that led the Sling marketing team to sell 100,000 units in its first six months of operations, and 500,000 units as of mid 2008. Buchanan brought Tami Bhaumik with him from Sling as well, who is now Ooma’s VP Marketing.
Ooma is also now being sold in 26 southern California Best Buy retail stores, with a nationwide rollout scheduled later this month.
The company has also tweaked their business model. They still offer the free service for a reduced price of $250, with optional additional features in a premier service add on for $13/month. The premier features include a second line, three-way calling, message screening and custom rings.
I’ve been a happy Ooma customer for a year now. I also use Vonage, and Ooma’s call quality is better and there are fewer problems in general. If I didn’t have one I’d buy one now.
San Francisco based Founders Fund launched in 2005 with a $50 million venture fund. They’ve had two liquidity events since then, and a handful of other very high profile investments (Facebook, Powerset, Ooma, Quantcast, Slide, Geni, Causes, etc.).
Today they will announce a second fund, Founders Fund II. It’s much larger - $220 million. And unlike the first fund, the money comes mostly from outside investors. The new fund will allow Founders Fund to make 15-20 new investments, including pro-rata investments in follow on rounds.
A couple of investments have been made out of the new fund, they say, but have not yet been disclosed.
Founders Fund partners have deep connections in Silicon Valley, which help with deal flow (Peter Thiel, founder and former CEO of Paypal, Ken Howery, founder and former CFO of PayPal, Luke Nosek, founder and former Vice President of PayPal and Sean Parker, founder and former CEO or President of Napster, Plaxo and Facebook). But they also approach deals differently than most other funds.
Sean Parker said today in a phone interview that a glut in venture capital, combined with reduced capital needs of most startups, has led to a shift in balance of power between entrepreneurs and VCs. Founders Fund recognizes that shift and has evolved does deals a little differently because of it. For example, they invented and promote the issuance of a special class of stock, called Series FF, which allows entrepreneurs to take money off the table much earlier in their company’s lifecycle. They also allow significantly more liberal voting rights to founder board members than many other funds. See this article in the SF Chronicle earlier this year for more on how they do business.
In the past we’ve posted communications whenever someone has threatened to sue us. I think it’s entertaining, and it hopefully makes people think twice before firing up the legal machine with ridiculous claims. So when YouTube sent us a cease and desist letter, I posted it. And when that asshole Shannon Terry threatened to sue us out of existence, I posted that too.
Now the most ridiculous claim yet. Richard Figueroa, who claims to have the rights to this image of Ashton Kutcher, is demanding that we pay him $150,000 immediately or else he’ll sue us for $1.5 million.
Hi Michael, My name is Richard Figueroa and I am contacting you on behalf of the image you are using of Ashton Kutcher that Beth Boldt had taken. Beth is upset that your company has been using his image to generate traffic and revenue to your company without her permission.We are asking that you pay Beth $150,000,00 for the image that you have been using to generate business. If you choose not to settle this bill now we will ask for $1,500,000 in damages in loss of income form the image you have been borrowing for creating traffic to your website with here picture.if you google Beth Boldt you will get an idea of who she is in the modeling and entertainment industry.We would like to settle this quietly without the media getting involved however if you choose not to agree on these terms we will file a lawsuit against your company for copyright violation and we all know how that’s going to turn out since she’s the photographer of the image you are using.
So here is her invoice: Please make check out to Beth Boldt in the amount of ($150,000,00) send it to
[deleted contact information]
And after payment is made you may not use the image of Ashton anymore unless you want to negotiate a contract.
Thank you
Richard Figueroa
BethBoldt
Here’s the problem: we never used that image of Ashton Kutcher on any of our websites. The one image we did use (in this post) was supplied by Ooma (Kutcher is the creative director for Ooma), and Ooma says they own that image.
The problem turns out to be that if you do a search on Google (or “the Google” as Figueroa calls it), the image in question appears at the top of the results and is linked to TechCrunch. Why? Well we did some digging and it turns out that someone linked to the image in a comment to one of our posts.
I explained all of this to Figueroa on the phone but he insisted that Google bought us and that we need to remove the image from Google immediately. Sadly, Google has not acquired us, and I have no easy method for removing images from Google’s servers.
Normally I’d just let something like this drop since this guy doesn’t understand anything about copyright law or the Internet, but he has also been calling and emailing our advertisers and threatening to sue them, too (listen to the voicemail below). They are understandably concerned, and Heather and I now have to spend time today calming everyone down.
Don’t be this guy.
The voicemail below is to one of our advertisers. Listen to a second one, sent to Ooma, here.
Update: Starting at comment #79 below it looks like Richard weighs in with a number of comments. In comment no. 113 he tried to post my phone number and get people to call me and complain but I just deleted it.
Update 2: Richard has been calling me this evening saying people are crank calling him and that he will take “legal activation” against everyone who calls him. I’ve removed the phone number above. Please stop calling him because he just calls me afterwards.
Update 3: So the link to TechCrunch on Google’s search results is gone and the picture now links to Yahoo Answers. Richard still isn’t happy and is demanding I link that search result to him. I’m just speechless.
New consumer VOIP service Ooma officially launched yesterday and began selling units on their website. See additional coverage from Dean Takahashi and Adweek.
They also released their first (drug induced?) viral video to promote the service, which I have embedded above. The video was conceptualized by Ashton Kutcher, the company’s creative director (hear our interview with Kutcher and CEO Andrew Frame here). Kutcher’s production company, Katalyst Films, produced it.
The company says the video is loaded with symbolism, and the meaning will become clearer over time as more videos are released in the series. Whatever it is, it’s entertaining.
Get one of the last ten free Oomas
The company gave TechCrunch readers fifty free Ooma systems in July. Today they say they’ll give us more to distribute to readers now - the last ten free Oomas. To win, leave a comment below and tell me WTF you think the video means, because I have no idea. The most creative answers win.
Vonage released its second quarter financial results today (I’ve embedded the release below with the new Zoho Viewer that launched last night). And while the stock continues to slide, revenues are way up and losses are slowing. Perhaps they can avoid the fate of competitor SunRocket, which shut down last month.
The company also says that they have “substantially completed” the workaround deployment for two of the patents at issue in the company-threatening patent litigation with Verizon. And development of the workaround for the third patent at issue is completed says Chairman Jeffrey Citron. A Federal court will have to agree before the company is in the clear.
Revenues for the quarter were a record $206 million, a 43% increase from the same period last year. Net losses were $34 million, down from $74 million in Q2 2006. The company still has $344 million in cash, although $66 million of that is reserved for collateral in the patent litigation.
Some bad news, though - customer churn increased to 2.5%/month. The company says they are extending the grace period for non-payment to encourage retention…but they may be retaining the deadbeats.
I am a long time Vonage customer but will soon be switching to Ooma (which, by the way, became available for purchase this morning) and getting rid of that $25/month Vonage fee. Vonage is a lot cheaper than a normal phone line, but free is hard to compete with. Perhaps some of the new hardware Vonage is testing with some customers will help them.
New VOIP startup Ooma, which is proving a free phone service to U.S. residents who purchase the basic hardware, started taking pre-orders about five minutes ago (6 AM PST). Orders are being taken by phone only, with delivery guaranteed before September 10. The phone number to call is 866-452-6662.
The basic unit, called a “hub,” is $399. Additional “scouts” which you can plug into the various phone jacks in our house cost $40 each. Sales tax is being collected on top of that for California deliveries. Once you’ve purchased the hardware, all calls to U.S. numbers are free. International calls are at Skype-like prices.
I don’t expect to see millions of people calling to buy an Ooma today. But for the early adopter crowd, this may be something they want to try out. I’ve been testing it for a few weeks and the call quality is good.
Consumer VOIP service Vonage is beta testing a new, self-described “cool and sleek, yet simplistic and approachable” gateway device produced by Ambit. The device, an Ambit VDV21, includes a LCD screen that displays caller ID and voicemail notifications. The hope, Vonage says in an email, is that it will “inspire consumers to proudly display their Vonage router rather than hide it under their desk.” It is not yet listed on their product page.
It sounds like they’re taking a page out of Ooma’s playbook. Ooma offers users a much more compelling VOIP device as part of their service; it includes a speaker, voicemail controls and other features. Ooma is also free once the hardware is purchased.
The Vonage gateway also includes other features - see the email sent to us below. If you’d like to test it, they are offering a month of free service during the test, plus a credit of $30 on your Vonage account. You must return the device at the end of the month, however. Sign up here.
We have fifty to give away. This isn’t like most account giveaways - each of these packages will be sold for $399 retail in September and gives you free VOIP phone service on your normal phones for life (the life of you or the company, whichever ends first). You get it for free, and you get it right now.
Here’s another cool thing about these - each one includes three free “white rabbit” tokens that you can give away to others so they can try out Ooma, too. They have a limited number of these, but they’ll continue to give three to everyone until they start to run out.
Here’s what you have to do. Just write a short comment below telling us why you want it. Or tell us about your favorite Ashton Kutcher movie or tv show (since he’s the Creative Director of the company). Or both. You don’t have to be truthful or nice, but you do have to be creative and entertaining. All you have to do is be one of the fifty most entertaining comments and you’re in. You have until end of day California time on Friday to write. Make sure you use your real email address in the comment or we won’t know how to contact you.
Ooma will only ship these in the U.S. for now, so you must be living here. And there’s one more rule - We’ll be adding Ooma to InviteShare later tonight and allowing people to sign up to get one. If you are selected you have to agree to give at least one of the systems to the person on the top of the InviteShare list. That way we can possibly get some more of these to TechCrunch readers.
Update: Ok Ooma is now up on InviteShare, so feel free to add your name to the list of people who want an invite. The list order is determined based on the time you enter your name as well as how many invitations to other services you give out, so move up the list by participating. If you are one of the fifty people who get a direct invite from this post, please remove your name from the list - and remember to give at least one of the invitations you receive to someone on the list.
An ambitious and long awaited new consumer VOIP startup - Ooma - launches on Thursday morning. Much like Vonage and the ill-fated SunRocket, Ooma allows consumers to use their normal phones to make and receive telephone calls, but at drastically reduced prices.
Vonage provides unlimited calling in the U.S. and Canada for a flat $25/month. Ooma, however, is using an innovative peer-to-peer architecture to significantly reduce their cost overhead. Because of that cost reduction, they’re charging for hardware only. Calls in the U.S. are free, and will be forever.
That doesn’t mean there’s no cost to the consumer, though. You still have to get your hands on the hardware, which starts at $399, and have a broadband Internet connection. That buys you a base hub. You plug broadband ethernet into one end, and a normal phone into the other, and you’re all set.
If you buy additional units, called Scouts, you can wire your entire house with Ooma. That is another distinct advantage over Vonage, which only allows a single phone to be plugged into the device. Spread the Ooma Scouts around the house, plugging one end into a normal phone jack and connecting it with a normal phone. It’s then part of the Ooma system and all calls will be free.
Instead of using normal exchanges to terminate calls like Vonage does, Ooma routes calls through the phone lines of other users if it can. That saves them the termination fee on the call and eliminates their largest marginal cost. That does mean that if you have a normal phone line (its not required to use Ooma) it will be used by other Ooma users, but it isn’t something you’d ever notice because your inbound and outbound calls are routed around it. And in the event you call 911, any phone call using your line is immediately broken and you are put right through. If there are no Ooma user within twelve miles of where your call is being terminated, Ooma uses the normal phone system. From the caller’s perspective, its all invisible.
The Ooma hardware is both beautiful and functional. Answering machine functionality is built in to the Hub and Scout devices via physical buttons. Every Ooma account also includes two lines, and either can be accessed from either phone. A speaker phone is also built in.
Ooma isn’t just making money on the hardware. They’ll be adding additional for-pay features over time. One of the most interesting is ringtones, allowing people to have customized tones for incoming calls. That’s generally considered a cell-phone only feature. I can imagine other cell-phone type services being added over time as well, and possible Ooma branded handsets.
If you choose to keep your normal phone line, I’d recommend changing your calling plan to the most basic, least cost choice. It’s basically a 911 backup in the event of an emergency.
I had the opportunity to interview founder and CEO Andrew Frame and Creative Director Ashton Kutcher (yeah, the actor) a couple of days ago. Kutcher is actively engaged in the business - part of his work will consist of creating a viral video series to promote the product. The podcast is up at TalkCrunch. In addition to Ooma, Ashton and I go on a brief detour and talk about the iPhone (he likes it, mostly) and his upcoming movie with Cameron Diaz.
The product is in private beta currently and we’ll be giving away a few Oooma’s tomorrow. They go on sale in September.
Consumer VoIP startup Ooma launched nearly a year ago and offered consumers free phone service for life, all you had to do was buy the hardware for $399.
San Francisco based 
In the past we’ve posted communications whenever someone has threatened to sue us. I think it’s entertaining, and it hopefully makes people think twice before firing up the legal machine with ridiculous claims. So when YouTube sent us a cease and desist letter, 
Vonage released its second quarter financial results today (I’ve embedded the release below with the new 
