Innovation drives up productivity and drives down costs

* Innovation as a key differentiator among infrastructure suppliers

Following our newsletter predicting VoIP and convergence trends for 2009, we heard back from IntelePeer regarding our points about the importance of execution in a down market. IntelePeer added that innovation also drives productivity and reduces operational costs and that innovation serves as a key differentiator not only among infrastructure suppliers, but also for vendors and solution providers.

In a follow-up interview, we spoke with John Hart, SVP of business development, and Charles Studt, VP of product management and marketing at IntelePeer. The executives also agreed the points we made last week suggesting that VoIP is far from dead.

IntelePeer sees software vendors and service providers integrating enhanced VoIP-based voice and rich media features like automatic conferencing and click-to-call into business applications and services. Hart pointed out that his company continues to see very strong demand from Tier-1 service providers to “VoIP-enable” stand-alone legacy voice applications. Studt pointed out that while the specific feature requirements vary from carrier to carrier, service providers are still adding innovative features to their network-based offerings, including bringing in voice-enabling “yellow pages” directories or POTS (plain old telephone service) connectivity into Web and CRM platforms.

The company does speak with some authority: IntelePeer has spent the last five years working with global carriers and service providers to build out a global peering infrastructure that carried more than 7 billion voice minutes in 2008. Also last year it introduced an open communications platform that allows Web and software developers to easily plug enhanced Voice and multimedia features into their products and services. The company received investors’ votes of confidence in November last year when it received its third round of financing with $18 million led by new investor VantagePoint Venture Partners and participation by existing investors.

Our observation: While tough economic times do tend to force companies to focus on superb execution, we agree with IntelePeer that down economies also foster an environment for innovation - with both improved execution and innovation contributing to long-term success.

Our thanks to the IntelePeer execs for their insights. Next up: reader reply to our contention that VoIP isn’t dead.

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