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10 Reasons Why Ooma Will Share Customer Data with Google

Oooma Review

Ooma’s relationship with Google

We were never fans of Google Voice.

Not sure why Google Voice never caught on, but it never felt right letting Google have even more data about our business and personal lives than they already do.

When it comes to voice service, it may be better to simply trust the phone company.

Or maybe even the cable provider.

Not that it matters, but both the phone company and the cable company are federally regulated.

Ooma logo

The Ooma service

Over the last year, we have been using Ooma for the home office phone system. But we are probably going to have to stop recommending Ooma.

Not because Ooma has bad service, but because they are “upgrading” into a direction that is not where we want to go.

Ooma developers have decided to redesign their customer login portal, My Ooma, to use hosted software libraries from Google.

Why would Ooma do this?

Not sure, but it seems very risky.

We wonder if Ooma considers Google to be a competitor?

Even just a little?

google logo

After all, Google has this thing called “Voice” which many would say overlaps the Ooma service.

add user

It is interesting to note that Google, most certainly, is NOT reciprocating by sharing their customer data with Ooma or any other start-up for that matter.

Those who understand Google’s business model will not have any difficultly figuring out why…

lazy ooma software developers using googleapis

Click to Enlarge

Anyone can clearly see what Ooma is doing with version 2 (v2) of My Ooma.

All you have to do is open v2 of My Ooma and then click “View Source” from your browser.

This will reveal many Application Programming Interface (API) calls to Google (i.e. googleapis.com) and other providers.

Every time an Ooma customer loads My Ooma v2, customer data is exchanged.

Ooma and the Lazy Man’s Approach to Software Development

Down the road, Ooma is going to be at the mercy of Google.

Programming

Senior management at Ooma should require their software developers to:

  1. Write their own code
  2. Create real value for the company

Instead Ooma developers are positioning the Ooma service to depend on third parties for Intellectual Property (IP). Furthermore key functionality resides on someone else’s server with the associated risk factors.

The third parties that should be of the most concern to senior management are the bigger, stronger competitors with expansive gazes in the areas of voice, data and mobile.

Leverage hosted APIs when they are good for rapid deployments, short term projects or low value assets… Nothing More

If you operate a boutique web design company, designing websites for local businesses, then by all means leverage “free” code libraries to the hilt.

You can pilot new ideas quickly and rapid launch for early feedback while buying time to invest in sustainable developments later.

As an independent web designer, you may not have the budget or the skills to deliver the entire solution. And your data may not be that valuable, because you have no web-based customer data.

In your case, you may only cater to web surfers. And your end users do not log into a “My” account where they enter their credit card numbers and have some expectation of privacy.

Who cares if the brochure website for the town’s surgery center or divorce lawyer goes out of service or is slowed down for a few hours or days in the year? These sites are valuable, but they are low traffic endeavors. So very few impacts from data breaches or outages. And definitely not an event that will drive a company out of business or destroy portfolio values for investors.

If you are a web designer taking these shortcuts, just be sure to mitigate the risks with future developments. And if you grow an end user login portal, then do not be a bonehead and deploy into production with hosted APIs.

Start-ups need to create value for investors and not pitch shortcut solutions provided by third parties

If you are a well funded start-up needing to create and preserve value for investors, why in the world are you relying on a disinterested third party to not only host your code, but provide critical code components that you should have developed in-house?

In the short term, this lazy approach to software development seems “cheaper”, but is it really?

Will the third party have your back when there are eventual problems such as data breaches or web attacks? Do you even have an SLA deal with said third party? Or are you crossing your fingers and hoping outages and other problems do not occur?

Google’s Business Model – Revealed

Google formula

Google, laughing all the way to the bank...

Here is Google’s simple formula for web, voice and data domination:

  1. Become pervasive throughout the Internet by giving away free software tools to consumers, businesses, governments and schools
    • Internet search results (Google.com)
    • Video hosting (YouTube)
    • E-mail accounts (Gmail)
    • Microsoft Office killers (Google Docs)
    • Telephone services (Google Voice)
    • Web browser (Chrome)
    • Mobile operating system (Android)
    • etc.
  2. The software solution does not have to be all that good, it just has to be free
  3. Co-opt lazy software developers and clueless technology managers by convincing them to bundle their solutions with Google products and services in exchange for information about their customers
  4. Capture customer data
  5. Give advertisers direct and indirect access to these customers and their data (Google Adwords)
  6. Profit!

Google will stop at nothing to control their turf.

Ooma management seems to be aware of the issue, yet they still jump in with both feet…

Here is a message posted by Team Ooma in 2013: http://ooma.com/node/1420

Can you say false sense of security?

Does Ooma care about securing customer data?

From an Ooma customer’s perspective, if they wanted a Google solution for their phone system, then why bother any longer with Ooma?

If Ooma is going to use hosted libraries from Google to deliver key aspects of their software and apps, then what is the value of Ooma to customers? And to investors?

By allowing Google to host key functionality that My Ooma needs to operate, does this mean that Ooma is sharing customer data with Google?

Every time an Ooma customer logs into My Ooma, they are passing information to Google.

Think about that for a moment…

Does President Obama care about data and the latest big name company getting breached through their own reckless behavior?

president barak obama

Last Friday, Barak Obama, President of the United States, visited Silicon Valley to talk about data breaches.

Granted the increasing use of hosted APIs by technology start-ups is not in the same category as a data breach by hackers.

But if you do not maintain tight controls on your company’s customer data or unwittingly give it up to “trusted” third parties, too big to fail, is it still a risk?

Whether you think Google is a trustworthy or even a capable company or not, is it worth the risk to let them run part of your business?

Is it a sustainable competitive advantage to leverage hosted Google code for a commercial web service like Ooma?

What risks are introduced for the business?

What are the ramifications for the customers?

Ooma’s privacy policy clearly states the following:

quote

Non-Personal Information may be shared with any number of third parties by Ooma.

In the course of providing Services to you, Ooma will collect and maintain certain customer-specific network information. Customer Specific Network Information refers to the types of products and services you currently purchase, related usage, and billing information for those products and services.

We value our relationships with our customers and are committed to respecting and protecting your Customer Specific Network Information. Accordingly, we will not sell, trade, or share your Customer Specific Network Information. (emphasis added)

One wonders if Ooma’s decision to share customer data with Google in exchange for free code and free hosting is in harmony with Ooma’s privacy policy.

Will Ooma listen, and more importantly respond?

Why are we picking on Ooma?

Well we really are not.

We really liked the Ooma service, but question their direction.

Will the technology leaders within Ooma try to debunk some of the claims?

Who knows.

But if they do, here is how it might play out:

  • They will have to first prove that they are not leading the company down the path of data sharing with Google.
  • If they are forced to admit data sharing, then they will have to explain to investors that trading customer data for free code and free hosting is worth the risk.
  • If they get asked about the risks, they might cite examples of other companies trading without issue or penalty.
  • They might then try to translate all of this into costs versus benefits and explain that they are saving the company money.
  • Then they might recommend ignoring the forum complaints and blog comments because customers do not care and are not in uproar, as evidenced by the fact that consumers in other venues routinely trade their personal information for free services from Google and others.
  • And finally technology leaders at Ooma will have to answer tough, probably insurmountable, questions from corporate counsel about exposing customer data and the legal ramifications.

Ooma has published a forum thread ostensibly to gather feedback from customers on this new direction they are taking, but only rarely do Ooma staffers respond to the questions raised by their customers.

Can Ooma get away with sharing customer data with Google?

This lazy software development mentality, inspired by Google, is becoming more and more pervasive. Not just with Ooma, but with many other web services.

Roman Emperor Augustus Statue

It used to be said that the sun never set on the Roman empire. Because Roman control was vast and wide.

Well most web activity and a lot of voice traffic has a Google component to it.

Many would be interested to see the numbers, but more and more web properties are using Google widgets, plugins, apps and code.

Those that don’t, can always count on a good number of users being logged into their Google accounts while they browse the Internet. Google tracks all of this activity and takes detailed notes.

Many technology companies are too careless with customer data and do not value customer privacy.

Can the consumers be blamed for not understanding the Internet or advanced business models by some of the largest players in the world?

It is true that consumers are too addicted to “free” and may not know the full extent of how they are painting themselves into a corner.

But when a consumer pays a company for service, how come the company thinks it is OK to trade their data to third parties, claim ignorance and pocket the profits?

Google places a high value on customer data.

Why else would Google provide all the free code and free hosting?

There is no free lunch.

And in defense of Google, at least when they take personal information from freebie downloading consumers, they operate transparently by publishing privacy policies and other disclosures clearly explaining that consumers are giving up their personal information in exchange for free stuff.

Nobody reads privacy policies, but it is still easier to swallow, as most consumers do not consider themselves to be Google “customers”. They never paid Google for anything. No credit card was required. No bill ever comes from Google.

So on the surface, Google looks like the genius hero, saving consumers money.

For profit start-ups, like Ooma, who will not even let you register for service without a purchase/credit card. So sorry Ooma it is unlikely that you will be able to take the money and run.

So here are the alternatives for Ooma (as shocking as they may sound):

  1. Stop charging money for your services
  2. Cease any trading of customer data for free code and free hosting
  3. Update your privacy policy

Is Ooma investment worthy?

All things being equal, is an online service that makes third party API calls more or less investment worthy than one that does not?

Admittedly this is a complicated question.

Especially if APIs are new to you.

One could say though that if you are a software technology investor and do not know what API calls are, then you should probably just take your money to Vegas. No card counting allowed.

Just like in Vegas, when it comes to APIs, the house always wins.

In this case, Google is the “house” and lazy software developers who work at short sighted start-ups are the marks.

quote
warren buffet

“Indeed, if you aren’t certain that you understand and can value your business far better than Mr. Market, you don’t belong in the game. As they say in poker, ‘If you’ve been in the game 30 minutes and you don’t know who the patsy is, you’re the patsy.’” — Warren Buffet, February 29, 1988 letter to Berkshire Hathaway shareholders

Bottom line…

The house always wins.

Invest in companies that publish APIs and make them available for downstream companies to consume.

At this time, Ooma is no longer recommended.

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