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Orcon put its “Genius” onsale today – an all-in-one gadget that can handle a broadband landline connection, internet voice calling (VoIP) and wireless internet.
The company’s spin is that the Genius can save people $35 to $40 a month by dint of the fact it allows them to ditch their voice line.
Instead, all calls are made over the internet using a so-called “naked DSL” connection. For Telecom, it's something of a Doomsday scenario if this setup goes mainstream (Paul Clarkin, CTO of second-tier ISP WorldxChange was quick to point out it wasn't new. "Congratulations to Orcon for finally catching up to the rest of the telco industry players who have been providing bundled VoIP services over naked DSL to consumers since 2006," Mr Clarkin told NBR).
The Genius comes in a Lite version (with no handset, on the logic most cordless phones can connect to it), or the Genius (pictured) which includes a handset.
Orcon chief executive Scott Barltett told NBR that his sales staff had taken 2000 orders for the Genius today.
The Kordia-owned company has 15,000 in stock and a further 10,000 “on the boat” from China. It is now considering ordering more.
All Orcon plans available for the Genius start at $70 a month.
The Genius Lite unit is free if you sign up to an 18 month contract. For a 12-month contract or no-fixed-term contract there’s also a $5 a month rental fee. The open contract adds a one-off $99 set-up fee.
The Genius is free with a 24-month contract. With a 12-month or no-fixed-term contract there’s also a $10 a month rental fee. For no-fixed term contracts a one-off $99 set-up fee.
Orcon is guessing most customers will go for the Lite version, given 98% of cordless phones can be plugged into the Genius.
The $70 a month gets you 30GB of data (with unlimited national calling an extra $15 a month), or 5GB of data plus unlimited free national calling.
Value-added features include the ability to have voice mail messages emailed to you as an MP3 file.
The Genius was first conceived two years ago, Mr Bartlett said, as a joint venture between Orcon and iiNet, Australian’s second largest ISPs.
Mr Bartlett said he met iiNet chief executive Michael Malone during Orcon’s failed bid to buy ihug in 2006 (the Wood brothers’ ISP was bought by iiNet for $A30 million. The Australian company subsequently on-sold ihug to Vodafone NZ).
The Orcon boss said he was motivated to diversify after the Commerce Commission ruled unfavourably – as he saw it – on sub-loop unbundling, or the price of competitor’s putting their own gear in Telecom cabinets.
With no suitable product on the market, iiNet formed iiNet Labs to work on the design of what became the Genius (or “Bob” as iiNet sells it) with Orcon’s “Genius Command Centre” chipping in.
A Chinese contract manufacturer was then signed to produce the gadget.
Mr Bartlett saw the Genius as a product that could pull millions in revenue from Telecom.
The impact on Orcon's own earnings is hard to guage at this point as Mr Bartlett refused to disclose development costs.
In Australia, iiNet sells its Bob2 device for up to $A279.
Mr Bartlett said iiNet would not tell Orcon how many Bob2 units it had sold, but did point NBR to the ISP's annual report, which states that 106,000 of its customers have naked DSL connections.
While there's nothing new about internet calling - many are familiar with using Skype on their PC or smartpone - VoIP/naked DSL service has so far had a relatively low profile in the market. It will be interesting to see how it goes now one of the big five ISPs (Telecom Broadand, Vodafone, TelstraClear, Orcon, CallPlus/Vodafone) is making it central to its product line for the first time (previously, the most active has been CallPlus, which has had mixed reviews for service overall).
The Genius is designed for plug-and-play setup, with all configuration done automatically, or remotely by Orcon. Most cordless phones should automatically "peer" with a Genius; those that don't can have thier base station directly plugged in.
The Genius has several features that could help push this technology into the mainstream.
In a test call to an iPhone 4, NBR found voice quality clear and strong.
Telecommunications Users Association chief executive Paul Brislen said the Genius pricing model looked appealing.
However, the Tuanz boss wanted to know how much of a broadband connection would be partitioned for voice calls, and what steps Orcon would take to prevent national calls "sounding like Skype."
An Orcon spokesman replied, "The amount of data needed to voice calls is smaller than you would think. We have end-to-end quality of service built in, and are extremely happy with the results.
"Our LLU [local loop unbundling, or calls from Orcon gear inside Telecom exchanges] calling is already all VoIP, so we are used to ensuring voice quality over IP."