BT Buys VOIP Provider Ribbit for $105M

Update: BT has agreed to buy VOIP company Ribbit for $105 million in cash.

Ribbit's platform lets developers add voice and automation features to most Web-based apps or social networks.

The platform is based on the SmartSwitch, a piece of software that enables voice data to move across land-line and mobile phones, while also integrating with Skype, instant messaging apps and Google Talk.

With this fixed/mobile convergence approach in mind, Ribbit provided open access to its SmartSwitch, providing APIs to let programmers integrate voice into their applications.

BT plans to deliver Web services over a new network, using Ribbit's VOIP capabilities as a key cog, Crick Waters, co-founder and executive vice president at Ribbit, told me July 29.

Ribbit's software will complement BT's W21C SDK (software development kit) initiative, in which the group's 9,000 developers integrate new applications with BT's services using a single line of code.

More broadly, this effort is part of BT's 21CN (21st Century Network) initiative, a move to migrate its telephone network from its present PSTN (Public Switched Telephone Network) to an IP system.

BT and Ribbit together will work to enable users to communicate across devices and networks without being bound to a specific carrier, contract or device manufacturer.

Previously, programmers have leveraged Ribbit to add voice to Salesforce.com apps.

Ribbit plans to launch Amphibian, a consumer app, later in 2008. Amphibian allows consumers to answer calls to their mobile phones from their PCs. Ribbit claims it is fair to compare this forthcoming app to Google's GrandCentral one-phone-number-for-everything service.

Ribbit, which now has great financial support and the backing of BT's global infrastructure to grow, will maintain its current management team and identity.

Waters told me he and Ribbit co-founder and CEO Ted Griggs will report to JP Rangaswami, managing director of service design at BT.

The deal is a sign that, even with a valuable technology platform, it's tough for startup companies to go against Apple, Nokia, Verizon, Google, IBM, Microsoft and several other larger vendors as communications and the Internet converge.

All of these vendors are, in some way or another, trying to seed the Internet with VOIP apps for business professionals and consumers.

Ribbit, which launched in December 2007 and thrilled the audience at Demo in January, enjoyed a big swath of positive press thanks to its promising technology. I was impressed with the demo Griggs and Waters gave me.

Now BT has swooped in to gobble it up. This is probably good for BT, and a nice payday for Ribbit's investors, but a little sad for those of us who like to see a cool technology company evolve.

But I guess if Ribbit was stuck in a rut without a telephony backbone, what other choice did it have?