Foonz Free Conference Calls Service Closed down

We didn't hear much negative news coming from VOIP market last quarter but it seems there is a major setback at Foonz which forced them to close down their free conference call service.

Foonz today officially announced through email to existing subscribers that they will be closing down the free conference calls service from May 22 2009.

The official Foonz Free conference calls service email says:

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We regret to inform you that as of May 22, 2009, we will temporarily suspend the free Foonz service.

We are disappointed that we have to do this, but we are unable to maintain our relationship with our current telephone carrier, and we have not yet been able to arrange for a new vendor.

We are working on an alternate solution, and we are hopeful that we will be resuming the service in the near future. Your account data will be maintained throughout this transition.

In the mean time, please let us know if we can be of any assistance during this service interruption.

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In our opinion several areas contributed to this falldown of otherwise excellent Free conference calls service. As I always said, the most important factor in any business plan is the revenue plan. Whenever someone approaches me for an investment, the first thing i ask for how will you make revenue from this idea. Trust me, 70% of the time people having great ideas doesn't know how they can make money off it.

Foonz didn't have any revenue stream which could keep them going. Giving away free conference calls and getting millions of users under your belt won't make you a great service. Especially when the VC's are looking for value buys and not just a surplus of userbase which is not going to convert for them or any other company who wishes to buy them. Afterall, everyone needs to make some profit.

For that matter, any VOIP service today offering free voip calls without advertisements or any other revenue source would fail miserably. The VC's are not going to hang around for long.

Were you one of the existing users of Foonz? What will you do after Foonz closes down on 22nd May? Will you switch to other conference call services? whats your next best conference call provider? Let us know.