Technology Makes VoIP-based Business Successful

Article from Whittier Daily News (Los Angeles) - 6/12/2006

MONTEBELLO - When Montebello resident Johnny Verdugo started a call center in his home recently, he never imagined he'd be taking it nationwide only a month later. So far Verdugo has made back $50,000 of his $100,000 investment loan. He said his call center, Political Tel Systems, is capable of putting out 3 million calls a month, and he expects that number to rise to 5 million. The 38-year-old former City Council candidate is among a growing number of people who are using increasingly affordable computer technology to create home-based, telephone-related businesses.

Propelling the businesses is the spread of wireless communications, the Internet and VOIP - or Voiceover Internet Protocol, which are telephone phone calls made over the Internet, said Jonathan Augenstine, a South Pasadena resident who, with his partner Brian McConnell of San Francisco, created Radio Handi.

Their company offers a sophisticated free service that allows members of small groups to speak together live via telephone from over 50 different locations in the world for the cost of a local phone call.

The service includes e-mails, SMS, voice messaging service, Internet and teleconferencing.

"Only two to three years ago, this same setup would have cost between $5 million and $10 million to install the hardware and build the infrastructure to handle the call load," said Augenstine. "The technology existed 15 years ago to provide this service, but the costs back then were prohibitive for most start-up people."

"This is a big trend," said Nick Pegley, vice president of marketing for All Covered, a technical services company in Redwood City aimed at small businesses.

"By using the Internet ... just like we send e-mails, it's now possible to use the same connection to send phone conversations.

"Before, we had one network for the phones and one network for the computer. Now they can be packaged together and sent across a computer network," Pegley added.

Where it was once costly and cumbersome to work through telephone companies, for the cost of a basic computer setup, the average person can integrate different communication technologies in complex ways while bypassing expensive telephone company rates.

"Basically, it boils down to people now having the ability to launch services with smaller capital outlays than previously," said Augenstine.

Verdugo came up with the idea for his call center after donating his home as a campaign office for state Assemblyman Rudy Bermudez, who ran for the state 30th Senate District in the June 6 primary.

Campaign officials installed a large bank of telephone wires in Verdugo's house. That prompted him to get the idea of doing his own political calls. He soon expanded his idea into providing a service to political candidates in general. (continues)