Ooma gets more Funding (and will make a bigger Crater)

Well, well, this is like the Herpes virus of VoIP: Ooma got another round of funding - a whole $14 million's worth. I guess by the preceding sentence I am nowhere near as optimistic about their survival as the author of the column I linked to.

While I applaud Ooma for their ability to convince some people to hand over other peoples' money, one needs to look between the lines of what's going on in the VoIP world:

After Sunrocket, any hint of competition in consumer VoIP pretty much ended. Sure, there is MagicJack rattling Vonage, but their appeal is limited to people who leave their computers on all the time. With most computers today drawing more than A/C units and rising power prices, that can't last.

Lingo and Packet8 exist, but have gone silent, leaving Vonage to the prize. Vonage has serious issues with customer turnover (called "churn" in the industry), and has flirted with the contracts by other names - "cancellation fee" and "rebate recovery fee" come to mind - following the lead of the mobile providers in the race to the bottom, since customers can't leave anyways.

An then there is Ooma. With an offering most people can't understand, the investors are throwing good money after bad. Look at the funds you have in your portfolio, and make your corrections.

Oooom... Are we really going to fall for this?

So my inbox has been deluged with people seeking my impressions of Oooma. Heck, they even have Blogspot blog touting how great this is. Newsflash: Most people heard the song "White Rabbit" and probably think that's what you're on. You had 9 hits when I looked this morning. Two was me - one yesterday, and one today to make sure I wasn't hallucinating.

However, you're giving the press some tokes too:

• The WSJ, as usual is in love...
• CNN also banters on

And the rest of the Internet is abuzz since yesterday.

Now, a quick recap of this week's events:

• A VoIP provider that loses more money the more people sign up implodes, with everyone stressing out and wanting to call the FCC to regulate the market for them.
• A Fly-by-night-style web site is set up, collects your CC info for your SunRocket account, and in return you get a customer number.

And now everyone's ga-ga over some new service, with no information on its web site except how great its management team is, and charges money up front but no maintenance fee for its systems?

You need to quit the white rabbit...

Seriously though, this is just another spin on the "lifeline" idea - if the customer chooses to buy both the device and connect a legacy POTS line, 911 will work. For some reason, these folks get the credit, but again, we know how well homework gets done around here.