Yahoo has bought Milpitas Internet telephony company Dialpad. This is perhaps one of the least surprising acquisitions of the year. Although it’s been coy about details, Yahoo has made no secret of the fact that it’s intently interested in expanding its Internet telephony footprint (Yahoo users have long been able to voice chat through Yahoo Messenger). When AOL entered the VOIP market earlier this year, it was simply a matter of time before Yahoo joined the party.
The more interesting question may be what Yahoo plans to do with Internet telephony. Based on a chat we had with Yahoo’s Brad Garlinghouse, vice president of communications products, in March, we’ll be looking for a lot of integration with other Yahoo communications services such as email and instant messenging.
For one clue, look across the pond at Yahoo’s partnership with British Telecom. There, the two companies have integrated the voice and instant messenger platforms. Users can make outbound calls to the regular phone network through their IM client and have any charges show up on their phone bill. Another feature uses IM to alert users that their home phone is ringing, and lets them forward the call to where they are sitting.
“We see that as a manifestation of the opportunity,” Garlinghouse said back in March. “And as VoIP becomes more and more of a reality around the world, we think that’s an example of a rich experience, and it’s an area where we will continue to invest.”
In the U.S., Yahoo has a longstanding relationship with phone giant SBC and a new partnership with Verizon, both of which could allow it to provide some of the same services here.
“As we think about the voice opportunity,” Garlinghouse said, “our unique partnerships with the access partners really puts us in the sweet spot.”
Garlinghouse also talked more generally about his vision for the communications services at Yahoo, and how he would like to see them become more integrated and easier to use. As an example, he pointed to the difficulty of having to update your IM, email and mobile address books every time a contact changes his or her phone number.
“The opportunity is to connect these and provide a converged experience,” he said, “the primary goal being, how do we simplify the user’s life?”
One question: What does this all mean for standalone VoIP companies. Only a couple of other companies — AOL and MSN — come close to having an array of services as big as Yahoo’s that can be merged with their voice offerings. Without partnerships, how will companies such as Vonage compete with a Yahoo voice offering?