I read Om Malik’s post in GigaOm titled Who will really make money in VoIP? In fact, a sound question which he answers very judiciously.



Will VoIP meet a similar fate what WiFi witnessed some years ago? It is no more a secret the hardware manufacturers like Netgear, Linksys and D-Link and chips makers made a huge profit for their Wi-Fi products and service providers failed to make money for their offerings.



Is it going to happen with VoIP? If not, just consider- Vonage incurred a heavy loss in the Q2. The Q2 result has also discouraged Verizon. Other bigwigs such as Skype and Sun Rocket are struggling to make money with their offering. On the contrary, Netgear, Logitech and Linksys are making windfall profits. These companies manufacture VoIP devices whose cost ranges from $100-to-$300.



Take the case of Netgear. The company will make a huge profit for its $250 wireless Skype phone. Logitech is also expecting a big profit for its three new VoIP devices-desktop, a Bluetooth headset and a speakerphone. Prices of these products are moderate to lure the customers.





In conclusion, Om Malik writes,

I just wonder if this is the new model - a model of limited profitability - in the post-PSTN standards based world. If that is indeed true, does that mean we are seeing an end of an era of specialized chip maker, and larger ‘index-fund’ like approach is going to be the way for chip companies to survive and earn a living? And what do venture capitalists do in these times of reduced profitability cycle? Unfortunately, I do not have answers, just questions. Hopefully, you will fill in the blanks.