In response to SprintNextel deal, Vonage joins the VoIP service bundle battle

Two stories broke today that on the face of it, have little to do with each other. But if you give these developments more than just a moment's thought, they have everything to do with each other.

These developments are:

Vonage Canada says it has signed a deal with Vancouver, B.C.-based Novus Entertainment that will let consumers in that city purchase Vonage phone service as part of a bundled deal with Novus' cable television and Internet products. Novus Entertainment is a provider of broadband Internet access and cable tv services to residential high-rise buildings in and around downtown Vancouver.

Four cable companies have signed a deal with cellular service provider SprintNextel to sell a package of products, including high-speed Internet, cable TV, regular phone services and cell. The companies-Comcast, Time Warner Cable,Cox Communications, and Advance/Newhouse Communications, also say the deal will set the stage for development of new services that will thrive by making devices work together. An example would be being able to watch stored shows obtained via cable on their cell phones.

Obviously, this would be a threat to phone companies who are also fighting to attract customers with service bundles. That's what most of the other bloggers and analysts are saying. But I'm not here today to repeat what they said.

I'm here to raise this point: what do these two developments tell us about VoIP?

The key is in the fact  buried low in some press accounts - that the SprintNextel deal will sell a co-branded wireless phone service through Sprint and RadioShack stores.

Internet voice services is all about bundling. The fact that these four cable companies will now be able to offer four-in-one, "quadruple-play" services means, for example, that their VoIP services can be bundled in with so many other goodies - in channels that reach directly out to the mall. We are talking about the advantages of ubiquity, omnipresence, variety of services, and bundled pricing.

So where does this leave the independent VoIP provider such as Vonage? Alone against this marketing, distribution, advertising and retail colossus of shared power. A power that in effect, will give their well-heeled cable VoIPcompetitors presence in more than 1,800 Radio Shack stores and throughout SprintNextel's formidable sales channels. 

That's why Vonage Canada did the deal I just described. They realize - as do their entrenched competitors- that the future of residential VoIP will largely be determined by the attractiveness of bundled services. It's all about finding partners that you will be able to team up with for those services.