Google continued its acquisitions shopping spree with the announcement that it is purchasing Gizmo5. Gizmo5 adds VoIP capabilities to Google Voice, pitting Google Voice directly against Skype and providing a platform to enhance Google Wave.
In response to an AT&T complaint to the FCC regarding Google blocking some calls on Google Voice, Google countered by stating that it does not actually provide the calling backbone so it should not be subject to those same communications rules. That is about to change.
Adding the ability to place calls over the Internet and from mobile devices using the Gizmo5 technologies will negate the argument the Google is not a telephone service provider and move Google to a different class of regulatory oversight from agencies like the FCC.
Gizmo5 provides Google with the ability to actually provide the voice service as well as the feature add-ons. Gizmo5 offers low-cost and free VoIP calls over the Internet and from mobile apps–similar to the services provided by Skype.
Imran Khan, a J.P. Morgan analyst, remarked “We think this allows Google to compete head-on with Skype, as this supports IM and VoIP calls, allowing users to chat with friends on Gizmo5, MSN, AIM, Yahoo and Jabber. Users can also make video calls through the desktop version, share files from their mobile phone or computer, and send SMS messages directly from their Gizmo5 account.”
Khan also makes an important observation about Gizmo5 versus Skype–open standards. Unlike Skype, the Gizmo5 VoIP service is built on the industry standard SIP (session initiation protocol) protocol. That opens the door for Google to also roll the capabilities of the Gizmo5-enabled Google Voice into the Google Wave product and transform it into a more comprehensive unified communications competitor.
I have found the current Beta version of Google Wave to be more than a little underwhelming, but its early and the product has tremendous potential. If it begins to morph into the smoothly integrated experience Google demonstrated in the Google Wave unveiling video, and combines Google Voice with its new Gizmo5 capabilities, Google Wave will offer a solid alternative for cost-conscious businesses looking for unified communications tools.
The Gizmo5 purchase is just the latest in a string of acquisitions for Google. The purchase of On2, reCAPTCHA, and now Gizmo5 are overshadowed by the mammoth $750 million purchase of AdMob, but each adds a new dimension to what Google has to offer.
The Gizmo5 purchase offers Skype some formidable competition in the short term, but the bigger picture will be what Gizmo5 allows Google to do in developing Google Wave into a more complete unified communications platform.