VocalTec - Internet Phone

VocalTec Communications Inc. is an Israeli telecom equipment provider. The company was founded in 1989 by Alon Cohen and Lior Haramaty, who patented the first Voice over IP audio transceiver. VocalTec was a leading VoIP company having supplied major customers such as Deutsche Telekom, Telecom Italia and many others.,

History

VocalTec was founded in 1989 by Alon Cohen and Lior Haramaty, its initial operations were devoted to research and commercialization of products which provide audio and voice capabilities for personal computers and over computer networks. Cohen and Haramaty developed and manufactured a PC sound card (SpeechBoard TM) that was sold mainly to the local visually impaired community in Israel with a unique Text to Speech software enabling blind people to use a computer in the Hebrew language. In 1990, technology entrepreneur Elon Ganor joined the company as CEO and Chairman,

In 1993, the Company introduced its first commercial product, The CAT, a peripheral device which provides audio capability for personal computers. In 1993 and 1994, the Company introduced additional products, including CATBoard, a full duplex audio card, an internal audio card that provides high level compression. Net sales of these products totaled approximately $0.3 million, $0.4 Million and $0.2 Million in 1993, 1994 and the first nine months of 1995, respectively, and the Company did not expect to recognize significant revenues from sales of these products in the future.

Ganor decided to shift the company's focus to software, and in 1993 VocalChat was born, a software that enabled voice communication from one PC to another on a local and wide area network, and VocalChat LAN/WAN, a hardware and software products that enable real-time voice conversations over local and wide area computer networks. The software was developed by a group of developers including Ofer Kahana (later the founder of Kagoor Networks that was sold to Juniper Networks), Elad Sion (Served in Israel TOP 8200 Intelligence army unit, died young in a car accident), Ofer Shem Tov (A software developer in Israel) and others. The software was presented in Atlanta in May 1993 at the Network InterOp trade show. In 1994 support for Internet Protocol was added and on Friday, February 10, 1995 “Internet Phone“ was launched with a near full page Wall Street Journal article by WSJ Boston Correspondent Bill Bulkeley, “Hello World! Audible chats On the Internet” was the header.

In early 1993 the company partnered with ClassX, a group of innovative teenagers, some were during their army service at renowned Unit 8200. According to Opher Kahane, one of ClassX co-founders, "Few people know that, while VocalTec may have developed voice boards for PCs, it was ClassX that developed the technology that makes VoIP transmission possible." ClassX was acquired by VocalTec in 1993 and its core team developed the first VocalChat product and later on the first Internet Phone, a modified version of VocalChat.

VocalTec Internet Phone

VocalTec released the first ever Internet VoIP application in February 1995. The product was named Internet Phone but according to Wired magazing many people simply called it iPhone; and was the world's first VoIP based PC to Phone software solution.

The software was invented by Alon Cohen and Lior Haramaty, the two co-founders of VocalTec Ltd. At the base of the Internet Phone residing the invention of Alon Cohen and Lior Haramaty named the "Audio Transceiver", which managed the dynamic jitter buffer that was critical for achieving adaptive lower possible audio latency along with handling packet loss, packet re-ordering, and receiver transmitter sample rate adjustments. The first implementation of the "Audio Transceiver" was carried out by Elad Sion.

Initial Public Offering

VocalTec had an initial public offering on the NASDAQ on February 6, 1996. The company sold 2,500,000 shares for $19 a share. 1,750,00 shares were sold by the company and 750,000 were sold by selling shareholders including Elon Ganor, VocalTec's CEO and his brother in law, Ami Tal, through their holding of La Cresta International Trading Inc. VocalTec's leadership who managed its successful IPO included: Elon Ganor - Chairman of the board and CEO, Ami Tal - Director and Chief Operating Officer, Alon Cohen - Director and Chief Technology Officer, Lior Haramaty - Director and Vice President Technical Marketing, Yahal Zilka - Chief Financial officer and Secretary, Daniel Nissan - Vice President Marketing, Ohad Finkelstein - Vice President International Sales,

In 1997, Deltathree, an American company engaged in the business of voice over IP telephony services, launched an Internet-based international low cost calling service using VocalTec's VoIP technology, and VocalTec Internet Phone "PC to Phone" solution. The same year, Europe's largest telecommunications company, Deutsche Telekom, bought a 21.1 percent stake in VocalTec for $48.3 million, in addition to purchasing $30 million in telephony products, services, and support over the following two-and-a-half years. During the Dot-com bubble the company’s share peaked at a price of $3,363 per share on March 3, 2000 (split adjusted).

In 2005, completed a business combination with Tdsoft, a provider of VoIP Gateways. and refocused on providing carrier-class multimedia and voice-over-IP solutions for communication service providers. The company's Essentra solution suite, comprised the essential building blocks required to develop a next-generation-network, addressing customers’ specific requirements in trunking, peering and residential/enterprise VoIP application solutions.

Reverse merger with magicJack

On July 16, 2010, MagicJack took over VocalTec in a reverse takeover.

ITXC

In 1997, VocalTec founded ITXC Corporation a US-based wholesale provider of Internet-based phone calls. The ITXC voice-over-IP network was powered by the VocalTec technology. The company was founded after Vocaltec's CEO at the time, Elon Ganor met Tom Evslin from AT&T (who led at the time WorldNet AT&T ISP initiative) in a conference, ITXC was founded, with Tom Evslin as its CEO and cofounder. VocalTec invested an initial $500K ITXC Corporation and gave a credit of $1Million in VoIP Gateway equipment in exchange of 19.9% of the company, AT&T followed with an additional investment. ITXC became the world's largest VoIP Carrier reaching a market cap of about $8 Billion as a Nasdaq company in 2000 (prior to the March 2000 Dot com crash).

In 2003 ITXC was acquired by Teleglobe.