Rebtel, a VoIP provider sometimes thought of as Sweden’s (smaller) answer to Skype, today is releasing a new SDK that will let iOS and Android app developers embed Rebtel-based voice calls by way of an API directly into their apps, free of charge. This represents a new line of business for Index Ventures/Benchmark-backed Rebtel, which has up to now built a business on its own retail, consumer cheap-calls VoIP offering, now at 22 million monthly active users and profitable.
In one regard, Rebtel’s new (and free) API is a case of disrupting the disruptors: it puts it into direct competition with the likes of Twilio, Callfire, TelAPI and others already chipping away at mobile carriers’ business by offering voice services as an embeddable, cloud-based service that takes consumers away from using voice minutes and on to data networks.
The SDK was initially launched as a limited beta in December with 20 developers including TGTHR, Agile Dimension, eXeltior and MobisleApps. Today marks the full rollout, with a self-service platform and bid for more users.
“We expect thousands of developers and project that there will be 10-15 million people using the platform by the end of this year,” Andreas Bernström, Rebtel’s CEO, tells TechCrunch. He bases this on the thousands of developers he says have been contacting Rebtel from around the world, including India, China, Europe and the U.S. to use the SDK. To date, the company’s forecasts have been close to reality: projected revenues of $80 million for 2012 turned out to be $79.6 million he says. Rebtel says it is currently on course to exceed the $100 million in sales they expect for 2013. That could also lead to an IPO in two or three years.
The idea, Bernström says, will be to keep the basic VoIP API free of charge, with that service effectively aimed at those interested in calling others using the same app — for example, one early adopter is the dating app Maybe, which lets users call each other to get acquainted. The idea is to tap into the long tail of app developers and apps — currently at around 750,000 developers working in iOS and Android, and covering some 1.5 million apps, by Rebtel’s estimates.
“In the beginning we have no intention to make money from this,” he says. “The bandwidth cost for us is relatively small so if someone has hundreds of thousands of users it’s not a problem.” In the free, VoIP-only implementations, consumers see a small logo for Rebtel appear before they get connected.
Further down the line, Bernström says that Rebtel will be introducing some paid elements, specifically around group calling and charging for call termination to landlines so that you can call any number, which is how Rebtel makes revenues today.
He adds that bigger users of the SDK, with customers in the multiple millions, will like also pay for added service-level agreements to ensure uptime in the app. As for who might be a larger user, Bernström would not name specific companies but says Rebtel is already talking with some large messaging providers and gaming companies that might want to add voice services to their apps, all with over 50 million users. (Worth pointing out that at this point WhatsApp is among the messaging apps that does not have voice services; Facebook’s messenger does, in certain markets.)
Offering its service as a API-based wholesale offering is Rebtel’s bid for scale that it has yet to achieve as a standalone business since launching in 2006. “That
for us this is a pretty big step since we’ve been a consumer service for such a long time,” Bernström notes. “We want to build up the Rebtel brand as the technology for voice.” For now, the company doesn’t plan to add support for Windows Phone or BlackBerry.
Introducing the VoIP SDK gives Rebtel a chance to do something else: help pick up higher-spending smartphone users. Right now the company’s user base is about 60% feature phone and 40% smartphone — partly due to it being a legacy service, and partly because up to now it has aimed squarely at the low-cost user market that typically uses lower end devices. Building a service that is specifically aiming for scale on smartphones only could help tip the balance in the other direction. Added to Rebtel’s own smartphone apps, the aim for this year is for the proportion to be 60/40 in favor of smartphone users.
Rebtel hasn’t raised any money since picking up $20 million in 2006 from Index and Benchmark, but nor has it needed to, since it’s already profitable and has $12 million in cash reserves to finance new projects like this one.
While Bernström is not fundraising, though, he isn’t adverse to talking. He says that the investment climate in Stockholm today is very healthy. “People from the Valley seem to be taking road trips here on a regular basis, so I’m seeing Sandhill Road right here,” he says. “I think, like anybody, if the right person came along with the right investment offer it would be interesting but we’re generating a lot of cash right now and growing at the speed that we want to.”