Can Narus single-handedly kill VOIP telephony?

In a story entitled The VOIP Backlash, the IEEE Spectrum is reporting that Narus, Inc. has:
“devised a way for telephone companies to detect data packets belonging to VoIP applications and block the calls. For example, now when someone in Riyadh clicks on Skype’s “call” button, Narus’s software, installed on the carrier’s network, swoops into action. It analyzes the packets flowing across the network, notices what protocols they adhere to, and flags the call as VoIP. In most cases, it can even identify the specific software being used, such as Skype’s.”
If, like me, you’re just getting into the entire world of Voice over IP or Internet Telephony, this story should be pretty disturbing.
The IEEE Spectrum writes that this solution from Narus isn’t expected to affect within-VOIP-network calls (e.g., Skype to Skype) but rather VOIP calls that are redirected out onto the existing telephony infrastructure (Skype calls this “Skype Out” and Vonage makes it a cornerstone of their VOIP offering, for example). The IEEE Spectrum, however, might not be entirely correct…

From a July 25, 2005 Press Release, Narus explains that:
“Analysts estimate that between 8 and 25 percent of the traditional network calling traffic is being bypassed with VoIP such as Skype, a proprietary, third-party VoIP service. With 150,000 new Skype users per day, the core business of traditional telephony providers is being threatened. By using Narus, telecommunications companies can gain an immediate understanding of lost revenue from bypassed VoIP traffic, the first step in determining strategic business directions.”
The implication here is that any Internet connectivity provider — not just telecom firms — can monitor traffic utilization levels and types of traffic and assess a levy on VOIP users. Including Comcast and other broadband providers, for that matter.
While I find Narus software’s ability to ascertain the origination of data packets in a busy network remarkable, I also wonder whether Narus, and the telephone companies that utilize its software, realize that historically technological barriers never stopped progress, they, at most, slowed it down a bit.
In this instance, if Narus software starts to produce a situation where VOIP companies like Skype and Vonage can’t offer off-Internet calls to large swaths of the globe, then one of two things will happen: the companies will either negotiate a lower tariff on the calls and still remain less expensive than existing long-distance solutions, or, more likely, reverse engineer the specific IP packets used by traditional telephone carriers and duplicate them, making it impossible to differentiate between traditional phone calls and VOIP phone calls.
The RIAA didn’t stop the iPod exploding onto the scene and reinventing our relationship with our music, nor did they stop recordable cassettes and recordable CDs, and the MPAA didn’t stop VHS recorders or TiVO devices, did they? They were just speed-bumps on the road towards the future.
I believe that Narus has created a similar sort of speed-bump on the road to a better, smarter, more sophisticated telephony future. In the future it won’t matter what kind of device you have or what kind of device they have on the other end. Telephone to computer, computer to telephone, laptop to cellphone, whatever, it’ll all be point-to-point connectivity via voice.
But having said all of that, I might try to keep my eye on the future, but it doesn’t always mean I like where we’re heading as a society and nation, by any means. There clearly is a major economic problem when telecom companies pour billions into creating high-speed infrastructures just to have their use subverted by smart software applications and the anticipated payback on their investments foiled. This is how companies go bankrupt, isn’t it?
I like VOIP and find it rather amazing that I can chat with my friends in Australia, the United Kingdom and Canada for free, that I can have a conference call, as I did this morning, with people scattered around the United States, and that I can even give people a real phone number that is funneled directly into my own VOIP “softphone” (Vbuzzer) automatically.
But somewhere, someone has to be paying for all of this bandwidth.
It’s not a matter of the telecom companies needing to police it, although Narus obvious believes that’s the path to a solution, it’s a matter more of the growing number of people insisting on free recognizing that there are infrastructure costs and that they need to be paid.
After all, a phone service that really minimized its overhead and streamlined its call routing by utilizing Internet fiber really should be able to dramatically undercut the ridiculously expensive long distance services on the market today.
In the end, it’s not about free, and it’s not about retaining the status quo, it’s about letting the market decide, letting innovative firms push the envelope, have the system push back, and collectively finding that happy compromise that represents adequate profit for the supply line and a sufficiently good deal or opportunity for the consumer that we’ll switch.
Meanwhile, I think I’ll continue to deploy my own VOIP solution, as I’ve been documenting in Comprehensive business VOIP solutions are too complex and Is VOIP ready for small businesses?
What do you think? Does Narus stand a chance of helping telecoms slow the adoption and utilization of VOIP telephony solutions, or are they just tilting at the proverbial windmills?

12 comments on “Can Narus single-handedly kill VOIP telephony?

  1. Hi Dave,
    First of all, detecting and (subsequently blocking) normal VOIP communications is not by any means a great technical achievement. I’m glad that Narus “devised a way for telephone companies to detect data packets belonging to VoIP applications and block the calls.”, and I’m sure it makes Narus a better product to have achieved this. However, the same can be achieved with a host of inexpensive or free network tools that exist and it’s by no means a difficult or a complex task.
    Secondly, what if VOIP communications were to use encryption technology such as those used by Virtual Private Networks today? The technology is freely available, is reliable and widely deployed. Adapting it to VOIP communications can be achieved in many ways and without too much trouble. What would the network providers do then? Block all encrypted traffic?
    Leaving the technical issues aside, how would users in any free society respond to network service providers blocking legitimate functionality the users have paid for simply because the functionality can be used to compete with their other product offerings? How would antitrust laws apply? I believe in any society where government or corporate censorship is not the norm, there would be significant opposition to this VOIP traffic blocking idea and any company that embarks on it might even suffer financial loss through loss of customers and even be ridiculed.

  2. I wouldn’t worry about this at all. If anything, Narus announcing this is bad PR. The pressures are already in place in the market to ensure VOIP. Any telco that implemented such a thing would get so much bad back on them that they would have to be utter fools to do so. Also, I would imagine that ISPs and the big IP networks are big customers of the telcos. I don’t think they would allow such a thing to happen.
    Anyway–VOIP is here to stay and if the telco’s are intelligent, they’ll embrace, add value, and compete.

  3. Speaking from the VoIP enduser fan base, I’m glad you brought this to our attention, Dave – though at first you were absolutely *ruining* my Saturday morning cup of coffee until I got to this paragraph, “While I find Narus software’s ability to ascertain the origination of data packets in a busy network remarkable, I also wonder whether Narus, and the telephone companies that utilize its software, realize that historically technological barriers never stopped progress, they, at most, slowed it down a bit.”
    Thanks for sharing with MLPF – I’d love to hear more about this so, I’ll share your blog with some of the noteable professionals I know in Telecom.

  4. Hi Dave,
    While finding what Narus does is remarkable, i’m not surprised. Why? Its progress, ain’t it great?
    From VoIP Magazine [], Verso Technologies announces that they too can block Skype plus other protocols. Doing a quick search on Google will yield more such vendors. So why are the internet folks so surprised?
    Ever since i’ve seen bandwidth management software (like Packeteer) and its likes (P-Cube, now under Cisco), i’m already expecting this day. I like things to be free, but as you have said, who will pay for the infrastructure cost?
    In the end, it is just a cat and mouse game, except that there is no winner here. Technology evolution will ensure that.
    My 2cents.

  5. Actually, I just read an article in PC World(Jan 2006) that indicates that the domestic Telco’s will not be using Narus to block calls as it is illegal. The article states that Narus will be used to identify VOIP calls, then lower their priority(which is not illegal), thus reducing call quality.
    Time flies like an arrow,,, and fruit fly’s like a banana.
    Groucho Marx

  6. All the writing I have seen on this usually revolves around whether network operators will simply kill the interlopers by sniffing and blocking technologies like Narus. Nobody is talking about how to solve the problem with a business. Stay tuned…….

  7. Dave,
    Just a couple comments.
    Blocking Skype is not that easy, we have contributed
    to the open layer7 packet filtering, the poor mans open source equivalent of Packeteer, and there is no set pattern for Skype. To block Sype you have to be quite a bit more sophisticated than just looking for a signature in the data.
    As per the debate over blocking VOIP…
    We chose not to pursue or go after any blocking business for VOIP for a reasons that I will just call gut beliefs.
    Protectionist strategies never work, although we can’t prevent them. My contacts at some of the US providers realize this is not a good strategy, so as far as I know, they plan to heavily push their own VOIP services to their existing customer base when it makes sense, and not worry about what the competition is running on their DSL lines. After all, they can market and roll consumer grade VOIP more efficiently and directly than Vonage since they already have mailings to a huge customer base.
    We have had small providers approach us often and tell us Skype blocking is something they would be willing to pay for. Perhaps we are fools for walking away from this, but we preach that in the long run providers can make revenue many ways, and blocking a competitive VOIP on their network is not a way to grow their bottom line and that it will backfire.
    My two cents
    Art Reisman
    CEO founder

  8. Sorry Dave, but Narus is not the only company that Blocks Skype and un-athorised voice calls in fact Narus just adds noise, we block almost any protocol. We have deployed in a few countries and are able to allow or disallow indervidual users at will We have a world wide market for this product range

  9. Hi There:
    I’ve been using VOIP for the past two years. Initially it was really good. However now, in the past few months, I’m getting a “warbling” sound when I try to speak to my friends on the other end. I have been unsuccessful in trying to make contact with the company and I can’t seem to find a way of cancelling the service. I’m in Canada. Just wondering if you know how I can get out of this situation and/or if there is any organization I can call to report this company and their poor service.
    S. Johnston

  10. Hi Dave,
    I’m producing a conference on Wireless VoIP later in the year, and would love for you to speak or lead our workshop on this subject. Perhaps you might contact me with you full details, and I could give you a call?
    Best regards,
    Direct Line: +44 (0)20 7549 9980

  11. I definitley think that there is place for NARUS technology. Some are agrguing the VoIP ‘blocking’ ligitimacy and some are arguing ‘the market forces that will eventually prevail’.
    Well, actaully, i think both sides are right. This is a natural process of new and distuprive technologies deployment. It is a aprocess whereby initially those that are hurt will prevent (block), struggle, and when they give in to the market forces, they will adjust their business models (some will disappear). Namley, to the point,VoIP will be initially blocked and eventually creat Quality of Service revenue.

  12. Hi Dave,
    After I change my stay and move to other place,with other providers,is there anything that will be left on my PC??Does this system downloads anything or it is just in provider system?
    Thank you for your kind info..

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