Stealth Startups: An premature review of Ooma

[geek]

All we know about Ooma, Andrew Frame's richly-funded stealth startup, is that it's a home phone box of some sort put together by "Silicon Valley's most accomplished minds". (When will entrepreneurs stop making such mockable boasts?) That's all we know officially, anyhow. Fortunately, the big-spending venture -- backed by $22m from DFJ, the Founders Fund and other investors -- has interviewed widely in its recruitment of the Valley's most accomplished minds. One of the candidates reviews Ooma's plan -- skeptically -- after the jump.

One of their backers suggested I look into an exec spot at Ooma earlier this year (I design telecom services and platforms). To me this looked like a well-intentioned company, but one that did not seem to understand who its competitors are.

Assume the goal of building a consumer device to make free/cheap long distance calls is their raison d'etre. Great idea, except Comcast and every other cable provider sell boxes that do just this. Or you can sign up for a flat rate plan with any major telco. There might be a niche opportunity for something like this, but other vendors like PhoneGnome have had a hard time as well. It didn't look like a very good place to be.

Of course, this could be a smoke screen for something else, but I don't what that might be. As boring and not sexy as it may be, it's always better to sell telecom products and services like this to businesses. They might have a need to shave a few pennies per minute off bulk calls to their call center in the Phillipines. Plus, it is very rare that telecom products of any type, with the exception of hot mobile handsets, really excite consumers all that much. When is the last time you heard someone in a state of breathless excitement talk about Verizon's new calling plan? Never.​

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