Google Rumored To Acquire Gizmo5

Posted on November 9, 2009 admin

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The Washington Post is reporting that Google is rumored to be acquiring VoIP company Gizmo5 in an important move that, if true, will result in serious improvements to both Google Voice and Google Talk.

You may have heard of Gizmo5 in relation to Skype founders Niklas Zennström and Janus Friis’ recent IP lawsuit with their former company. In that lawsuit, Skype settled with the founders regarding charges that royalties were not being properly being paid to Joltid, which owned crucial back-end technology involved in Skype’s VoIP service.

Gizmo5 was discussed in relation to this suit as a possible acquisition target for Skype should a settlement not be reached in the lawsuit. Gizmo5’s technology was seen as a potential replacement for Joltid’s.

Now, apparently, Google has swooped in at the last minute and made the highly strategic acquisition of Gizmo5 for $30 million in cash.

Using Gizmo5’s technology, Google Voice will now be able to allow calls to be made directly from their users’ computers. (Previously, outgoing calls could only be connected via computer to a mobile or land-line phone and not made directly from the computer itself.) Google Talk should also benefit, by gaining the ability to have calls terminate at regular telephone numbers, similar to the Skype Out service.

In terms of further competition between Google and Skype in the VoIP space, this deal looks to put finally Google on an equal footing, technology-wise. Hopefully, this is great news for the consumer.