VoIP profit or one-time event

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One of the more interesting aspects of becoming an Internet news editor is observing the way information gets passed around as fact without so much as a raised eyebrow. To be fair, I've passed on an email or two about some exigency that I didn't confirm. I usually try to say as much when I pass something on, as I do in these newsletters with words like "reported" and "according to." That usually means that I haven't actually used the device in question or spoken directly with the individual involved.

What I have done is a fairly exhaustive search encompassing reputable publications, available business databases and as much information as I can get on short notice from companies and people themselves. There are a lot of press releases posted ad nauseam masquerading as news articles on the 'Net. They get picked up by search spiders that spit out the headline again and again, so that a non-event eventually appears to be actual news and is perceived as such.

Which brings me to the copious proclamations about a standalone VoIP player posting a profit. Indeed, Santa Clara, Calif., 8x8, parent company of VoIP provider Packet8, posted a profit in its most recently completed quarter. It was the first for the company since November 2002, when it launched Packet8. But the headlines about a "VoIPer posting its first profit!!!" are technically accurate, perhaps, but in a superficial way. (I know, I know. The Internet is a virtual Mardi Gras of superficiality, raising it to the art form it deserves to be.)

I have no problem with superficiality, per se, but making any sort of VoIP market extrapolation from 8x8's profit is a bit of a stretch. Their consumer VoIP revenue fell, and gross churn was a brutal 9 percent according to 8x8 executives, who had the spines to say as much during the company's earnings conference call. To his credit, 8x8 Chairman and CEO Bryan Martin emphasized "a number of one-time accounting benefits" during the quarter. Those included, among other items, $573,000 in revenue from a change in company's contribution to the Universal Service Fund--$65,000 more than the $508,000 profit reported.

I'm not slamming 8x8 here. On the contrary. I'm pulling for this company with the candid executives. I'm hoping they've hit upon the right combination of consumer and enterprise VoIP to keep the concern going. I have nothing against the Roberts family in Philadelphia. Genuinely nice folks, they are. But I'd rather that my communications providers consisted of a list longer than Comcast. I also don't want to see 8x8 tagged with a sensationally derisive headline and drug through the sausage factory of Internet news if they post a little red ink again next quarter.

If you have any comments, observations or feedback, by all means, post your thoughts below or share them with me at dmcadams@fiercemarkets.com. -D.