Every consumer loves free.

The Mobile VoIP industry was founded on and grounded in free.

However the very premise on which the industry was founded may also be it’s downfall.

Like it’s big brother, fixed line VoIP, the Mobile VoIP industry, once in a race to zero, is now litter with dozen of comapnies all figuring out how to make money from a business model based on free or cheap calling.

Take MOBIVOX, for example. Last week they announced that there would no longer be allowing free MOBIVOX to MOBIVOX calls and customers revolted. It is tough to blame their customers. The MOBIVOX service was built, like so many others, on FREE (just look at their home page). Once you give something to your customers, they feel they are entitled to it. Free is no different.

I don’t see anything wrong with the move by MOBIVOX, after all this is business, but there is a quick lesson in here for all telecommunications entrepreneurs; if customers only value (or use) your service because it is free, just how valuable is your service? No matter what anyone says, free is not a business model and a business without a revenue model is not a business at all.

MOBIVOX offers valuable services (as Phil points out), yet chose to promote free as their primary benefit. It is a shame that they put themselves in this position as they most certainly face an uphill fight to change the consumer perception of their service; question is, do they have what it takes