BT (British Telecom) has acquired Silicon Valley-based Ribbit for roughly $105 million, according to various news outlets. Rumors of the deal first emerged on Venturebeat, though company officials vociferously denied any deal. Our sources say the delays were mostly due to internal issues at Ribbit.
Michael Boustridge, President, BT Americas said: “The Ribbit platform makes it simpler, cheaper and faster to build communications functionality into applications, enabling developers to introduce new revenue-generating voice services in hours, rather than weeks. By combining the Ribbit platform with BT’s existing web services, we have the potential to deliver some of the world’s finest applications for communications innovation benefiting consumers and businesses alike.”
As we have pointed out before, there seems to be a lot of interest in merging voice with Internet applications, but the whole process hasn’t been a slamdunk. Dameon Welch-Abernathy, in his post earlier this month pointed out:
… Ribbit, a company whose business model is to make telephony available through APIs. The thinking is that they’ll make their money on revenue shares as developers create interesting applications.
If Jaduka’s experience is any indication, however, I don’t expect Ribbit will last too much longer without a complete change of strategy. Ribbit might have 4,000 developers, but how many of them are actually making applications on which Ribbit is able to share revenue?
Taking that into context, this is a great exit for Ribbit founders Tedd Griggs and Crick Waters — and for Mountain View, Calif.-based Ribbit’s backers: Alsop Louie Partners, Allegis Capital, KPG Ventures and Peninsula Ventures. Ribbit was long on hype and underwhelming on end results.
As far as the buyer is concerned, I am not sure how much of a benefit BT is really going to see from the deal. BT has always been long on promise, but short on execution of its grand vision. Its 21CN is a perfect example. It was supposed to be this new network and a platform that would enable new services and seamless bandwidth. Someday it will.
The 21CN plan included a platform that allowed developers to embed voice into internet applications. That platform still exists, but one wonders if anyone is using it. So perhaps it had to go out and buy what is essentially a Class Five switch with a pretty Internet interface.
Ribbit, as an independent company, was able to get some — not a lot — of developer interest. I am not sure how BT is going to do that. It is, after all, a telecom operator that wants to operate like an Internet company. Sure, in a circus you can make a dog walk on two legs as well.