A Canadian Internet service provider hopes to fill a niche by offering voice-over-IP telephone services to connect Canadians from East Africa with their relatives overseas.
Ottawa-based Filaj Corp. on Tuesday said it will be offering
six different voice-over IP (VoIP) pricing plans geared towards the Somali and Djibouti communities in Canada ranging in price from $29.95 to $52.75 per month. Besides their home countries, members of these communities will be able to call the United Kingdom and the U.S. Midwest. The company says there are more than 100,000 Somali and Djibouti residents in Toronto and Ottawa alone. (The Midwest is also a popular location for East Africans.)
The FilajNet service will use a network backbone from BabyTel, a Montreal-based provider of land-based telephony services using an Internet connection. BabyTel, which is a subsidiary of unified messaging firm Voice and Data Systems, began offering VoIP about a year ago.
Yassin Mohamed, Filaj’s vice-president and chief technology officer, said the long-distance charges of traditional telephone networks represent a significant barrier for East African people who come to Canada.
“Today you have people in major capital cities paying $3 a minute. That’s why nobody calls,” he said. “It’s very difficult for these people to stay connected. There is no such thing as market penetration. Imagine what it will be like for these remote areas. This is the only feasible technology that can accomplish it.”
BabyTel vice-president and CFO Jonathan Schacter said the company wants to act as a “provider to providers,” allowing ISPs and cable companies the ability to enter the VoIP market, which is quickly filling up with competitors, within 30 to 60 days. Filaj, he said, is its first customer to be aiming at this kind of niche, but BabyTel is in discussion with potential customers looking at similar VoIP offerings.
“I don’t think it takes a big stretch of the imagination to see VoIP makes a big difference to everybody, but there are segments of the population where the value is that much greater, because of their calling patterns,” he said.
Filaj has been offering ISP services to East African communities in Canada since 2002, but it struggled to find a way of taking advantage of VoIP without BabyTel’s help, Mohamed said.
“We talked to a couple of places and they would not consider the small, energetic company. They would prefer to talk to big players,” he said. “We’re not Bell, we don’t have millions of dollars in our pockets.”
Mohamed said he hopes to see the development of Internet cafes in Africa where users could access VoIP services as well.
“PSTN is long dead,” he said. “We have no doubt it’s going to happen. We want to be the providers of voice-over IP for all of Africa.”
Jon Arnold, an independent VoIP analyst based in Toronto, said some providers in the United States are marketing to Hispanic communities in Florida who want to reach their relatives in South America.
“In Toronto, you have those markets too – but the calling card community kind of caters to that, because that’s what fits. It’s cash and carry, you pay as you go,” he said. “It’s an easy approach to bring something to the market, but this sounds pretty small potatoes. How many of them are even using broadband?”
The fact that FilajNet will be run by members of the East African community will give the initiative credibility, Schacter said, and show other providers they may be able to follow its lead.
“Second- or third-tier ISPs really need a solution,” he said.