Deltathree

Deltathree Inc. was an American Internet telephony company founded in 1996 to develop lower-cost international calling services using voice over Internet Protocol technology. Its business emerged during the early commercial development of VoIP, when international telephone calls were generally carried over expensive traditional circuit-switched networks. Deltathree promoted Internet-based calling as a way to reduce the cost of cross-border voice communication, and its services reportedly reduced international calling costs by more than 90 percent compared with conventional alternatives. The company’s initial technology and service concept centered on a “PC to Phone” model. Customers could use a software-based softdialer to place calls from a computer over the Internet, including a free version of the product. Deltathree also developed broadband phone services that allowed users to connect a conventional telephone to an Internet connection through an Analog Telephony Adapter or a Linksys PAP2 device. This approach enabled customers to make and receive calls without keeping a personal computer connected during the call, helping bridge the gap between familiar household telephones and emerging broadband communications. Deltathree was founded by Dmitry Goroshevsky, Sophia Babkove, Damian Kudriavtsev, Elie Wurtman, and Jacob Ner David. Israeli company VocalTec Communications supplied technology used in the company’s early PC-to-phone solution. In 1997, RSL Communications, an investment firm associated with Ronald Lauder, acquired a majority stake. Deltathree subsequently became a public company through an initial public offering on NASDAQ in November 1999. Elie Wurtman served as chief executive from the company’s formation until the IPO period and was involved in an early transcontinental phone-to-phone VoIP call with Federal Communications Commission chairman Reed Hundt. The company underwent major ownership and leadership changes in the following decade. RSL Communications sold its interest in 2001 to entrepreneur Yitzhak Tshuva, who later sold the shares at a profit. The original founders also left in 2001 to establish CrossOptix, an optical-interconnect technology company. Noam Bardin became chief executive after the founders’ departure and remained in that role until 2007. Bardin later became associated with Waze, the GPS and navigation application company. Deltathree’s public-market position weakened during the 2000s. Its NASDAQ shares were delisted in March 2008 after the stock fell below the exchange’s minimum price requirement, after which the shares traded through the OTC Bulletin Board. In December 2009, Deltathree announced the sale of a 54.3 percent majority stake to Australian company D4 Holdings for $1.17 million in cash. The transaction also gave D4 Holdings the right to acquire an additional 30 million shares at four cents per share during a ten-year period. The company’s research and development and operational activities were based at Jerusalem Technology Park. Deltathree is historically significant as an early commercial VoIP provider, but the available reference material does not establish its current operating status, ownership structure, product availability, or corporate website.

Deltathree was established in 1996 by Dmitry Goroshevsky, Sophia Babkove, Damian Kudriavtsev, Elie Wurtman, and Jacob Ner David. The founders sought to use VoIP technology to provide lower-cost international calling and developed a PC-to-phone service based partly on technology from Israeli communications company VocalTec Communications. The business was created during the formative period of Internet telephony, when broadband access and software calling were beginning to challenge traditional international voice networks. The company offered a softdialer that enabled customers to place calls through a computer. It also developed broadband phone services using an Analog Telephony Adapter and the Linksys PAP2 device, allowing a standard telephone to be connected directly to an Internet connection. Deltathree presented these products as a way to make international calls considerably less expensive while retaining a familiar telephone experience. In 1997, RSL Communications, an investment firm owned by Ronald Lauder, acquired a majority interest in Deltathree. The company later went public on NASDAQ in November 1999. Elie Wurtman led Deltathree from its founding through the IPO period. During his tenure, he participated in an early transcontinental phone-to-phone VoIP call with FCC chairman Reed Hundt, an event that illustrated the company’s association with the early development of Internet-based voice services. RSL Communications sold its stake in 2001 to entrepreneur Yitzhak Tshuva, who subsequently sold the investment at a profit. That same year, Deltathree’s original founders left the company to form CrossOptix, which focused on very high-speed optical interconnect technology. Noam Bardin became chief executive following the founders’ departure and led the company until 2007. Bardin later became chief executive of Waze. Deltathree’s public-market performance deteriorated during the 2000s. NASDAQ delisted the company’s shares in March 2008 after the stock traded below one dollar, and the shares moved to the OTC Bulletin Board. In December 2009, the company announced that D4 Holdings, an Australian company, had purchased a 54.3 percent majority stake for $1.17 million in cash. The agreement also granted D4 Holdings the right to acquire a further 30 million shares at four cents per share for ten years. The company’s research and development facility and operational center were located at Jerusalem Technology Park. The available sources document Deltathree’s early products, ownership changes, leadership history, public-market decline, and 2009 recapitalization, but do not provide reliable information about its current corporate status, active services, later ownership, or present-day website.

• 2009

  D4 Holdings takes majority control

  [1]Deltathreeen.wikipedia.org

  D4 Holdings acquired a 54.3 percent stake in Deltathree for $1.17 million in cash and received an option covering additional shares.

• 2008

  NASDAQ delisting

  [1]Deltathreeen.wikipedia.org

  Deltathree was removed from NASDAQ after its share price fell below the exchange’s minimum requirement, and its stock moved to the OTC Bulletin Board.

• 2007

  Noam Bardin leaves the chief executive role

  [1]Deltathreeen.wikipedia.org

  Noam Bardin’s tenure as Deltathree chief executive ended; he later became associated with Waze.

• 2001

  Founder departure and ownership transfer

  [1]Deltathreeen.wikipedia.org

  The founders left to establish CrossOptix, while RSL Communications sold its Deltathree stake to Yitzhak Tshuva.

• 1999

  NASDAQ IPO

  [1]Deltathreeen.wikipedia.org

  Deltathree listed its shares on NASDAQ in November 1999.

• 1997

  RSL Communications acquires a majority stake

  [1]Deltathreeen.wikipedia.org

  RSL Communications, an investment firm associated with Ronald Lauder, acquired majority ownership of Deltathree.

• 1996

  Deltathree is founded

  [1]Deltathreeen.wikipedia.org

  Five founders established Deltathree to develop low-cost international calling through VoIP and a PC-to-phone service.

An early, cost-focused Internet telephony provider that used VoIP to make international calling substantially cheaper and to connect ordinary telephones to broadband networks.

• VoIP calling software

  Softdialer

  Deltathree’s softdialer allowed users to place Internet-based calls through a computer. The service represented the company’s early PC-to-phone model and was offered in a free form according to the available reference material.

• Residential VoIP service

  Broadband Phone Service

  The broadband phone service connected a conventional telephone to an Internet connection through an Analog Telephony Adapter or Linksys PAP2 device. This allowed customers to make calls over broadband without relying on a computer during the call.

• International voice service · 1996

  PC-to-Phone Calling

  Deltathree’s PC-to-phone offering was designed to route calls from Internet-connected computers to regular telephone numbers. It targeted international calling and emphasized the substantial cost savings made possible by VoIP.

• 2009

  Sale of a majority stake to D4 HoldingsM&A

  Background

  Following its NASDAQ delisting and subsequent OTC trading, Deltathree announced a change in control.

  Action taken

  Australian company D4 Holdings purchased a 54.3 percent stake for $1.17 million in cash and received the right to buy an additional 30 million shares at four cents per share for ten years.

  Aftermath

  D4 Holdings became the majority stakeholder. The available reference material does not establish the company’s later operating or ownership status.

  Cash consideration for 54.3% majority stake. $1.17 million (December 2009)

  Source

• 2008

  Transition from NASDAQ to OTC tradingOther

  Background

  Deltathree’s stock fell below the minimum price requirement for continued NASDAQ listing.

  Action taken

  NASDAQ delisted the shares, after which they traded through the OTC Bulletin Board.

  Aftermath

  The move reflected a significant deterioration in the company’s public-market position and reduced the status of its stock-market listing.

  Source

• 1999

  Public-market expansion through a NASDAQ listingStrategy

  Background

  Deltathree was operating in the emerging commercial VoIP market and sought access to public capital and greater market visibility.

  Action taken

  The company completed an initial public offering and listed its shares on NASDAQ in November 1999.

  Aftermath

  The listing made Deltathree a publicly traded Internet telephony company, although its shares were later delisted in 2008.

  Source

1. 1Deltathreeen.wikipedia.org