Today I just heard about this new ICO based on the Ethereum network called Ziber. t's a play on the name of Viber, the popular free calling app. Look they have a cool logo...
Ziber seem to be making an effort to publicize this ICO and drum up some interest in the community. I caught a sponsored post by Steemian 
Unfortunately crypt0 isn't very technical in his video - it's basically a paid for marketing pitch (which he freely admits) and he hasn't done any more than I did ie. read the ziber.io web page and their white paper. But I have been working on telephony systems on and off for over 10 years so I have a pretty good idea of what Ziber is and how it probably works.
In addition, Ziber's website and whitepaper are also decidedly non-technical and lacking in details. They don't even appear to be written by a native English speaker so at times they can read a bit like a Chinese VCR instruction manual (assuming you're old enough to remember what a VCR is).
So based on what I know at this point I think it would be good to have a bit of a technical dive into Ziber. However as I said, some of this is still conjecture since their software is mostly not public (see below) and they are being guarded about how it all works at this point to avoid a competitor coming in quickly and scooping their idea.
What is Ziber?
Fundamentally Ziber is a system to make a phone call to a destination phone number - a real phone number on the PSTN (public switched telephone network) such as a mobile phone or landline - and route some part of the call using a remote mobile device that can make that part of the call for free. The sole motivation for that is to save money - for some users a lot of money, depending on what kind of charges their phone carrier charges.
Let's illustrate this with a quick use case:
The Nigerian Prince
Say you're a Nigerian prince and you want to call from Nigeria to your latest mark friend in America who is proving particularly resistant to your latest scam great idea and wants to talk about all the details at length. Unfortunately, your phone company charges you $0.50 per minute to call America and at that rate you're going to be bankrupt before your American friend agrees to wire you the $10,000 dollars you need to gain access the $100 million fortune that is currently stuck in escrow (yes, people still fall for that one!)
You've thought about using Apple Facetime but don't have an Apple phone. For some strange reason the American doesn't want to friend you on Facebook so you can't call him for free with Facebook calling. He doesn't have a Skype account to do a free Skype to Skype call and they also want a lot of money to make the call to his actual phone number, as do all the other online services who offer international calling. Shame. Just what are you to do?
Enter Ziber!
Using the free Ziber app on your desktop or phone you can enter the destination phone number and magically call your friend for only $0.01 per minute. Great, now you can talk for hours and hours and barely spend anything at all. This is perfect you think!
But how does the magic all happen?
Well, it's all a hop, skip and a jump. Or maybe a hop, jump and a skip.
The local hop
Behind the "magic" is Ziber who is acting as a "man in the middle" for our Nigerian prince's phone call. When he calls the American's destination number in the USA, say +1-200-555-0000, he's not actually calling it directly using his phone's voice calling minutes. He's using that Ziber app on his phone or desktop that is calling an intermediary node operated by Ziber, most likely using a technology called VoIP (Voice over IP). VoIP only uses data bandwidth, just like Skype, Facetime or Viber, not actual voice minutes on his calling plan - even on a phone, it might even be using just WiFi data which is usually free.
To ensure call quality you would try to ensure this intermediary node is as close to our Nigerian prince as possible and on a good network with fast, low latency and cheap connections to the rest of the world. Ideally, it would also be in Nigeria but it might not be since Ziber is unlikely to start operation with intermediary nodes in every country.
The international jump
The intermediary node that Ziber operates can then route the VoIP call over the Internet to another intermediary in the remote country - in this case, the USA. This can be encrypted or over a dedicated VPN to ensure privacy and quality of the international leg.
Depending on network quality this international jump could be completely superfluous - you could go from the originating Ziber client app directly over the Internet to the destination country. It all depends. The intermediate jump could help circumvent country to country network censorship or blocking or improve call quality. These factors are all part of operating a globally available VoIP network.
The destination skip
Once in the USA Ziber can use a list of proxy devices. These are mobile phones owned by Ziber clients - people who have volunteered their phones to be used to make calls for the Ziber system. The calls they will make for Ziber are only to numbers that they can call for free using their mobile calling plan. Just what those numbers are depends on the calling plan the client has for their phone and what cellular network they are on. In the USA it is quite common to be able to call someone anywhere in the USA for free - sometimes in Canada as well. That applies to all numbers, regardless of whether they are mobile phones, landlines or what their phone carrier is. In Europe you'll often find things like free calling between number on the same cellular network - an incentive to get customers to bring all their friends to their network. Customers may even have a fixed bucket of minutes per month to call certain other countries for free.
At this point I haven't really figured out what happens next. I had an idea about call forwarding but it doesn't really make any sense yet so I have a few conjectures...
Normally routing a call from VoIP to the PSTN phone network (also known as "terminating a call") is going to cost the VoIP network operator some finite $ per minute. If the call needs to go to a cellular phone number then in many countries it will cost an additional amount over calling a landline (except in the USA where the receiver of the call generally pays because our carriers double-dip charging for outbound and inbound calls on mobile phones). Say I call the UK from the USA - it will cost me something like $0.02 per minute to call a landline, but it will cost more like $0.10 to $0.20 per minute for a mobile number.
So the question is if my proxy devices are all mobile phones then how can Ziber claim to make end to end calls for $0.01 per minute or less? In addition, there is the requirement that the proxy device's phone number is never exposed to the destination party. In fact as Ziber claim, it should look like the call actually came from our Nigerian prince's phone number.
I had been thinking a way to do this would be to have the Ziber client app set up call forwarding just before the VoIP call is terminated. In our example case it would say "forward all calls to +12005550000" and this forwarding happens at the cellular network level. Then Ziber connects the VoIP call to the proxy phone number +1300555000 and the mobile carrier would do the forwarding of the call so it instead dials our prince's American "friend" on +1200555000 instead of the proxy device. Because the call is forwarded the originating number would be whatever Ziber's VoIP node say it was - so they'd put in the Nigerian prince's number.
However this doesn't really make any sense because if Ziber can fake a caller id, and Ziber can terminate a call to +1300555000 why can't they do the same to call the American friend directly without the proxy and forwarding in the way?
So then I wondered if somehow they are instead sending the VoIP call to an app on the proxy device and it is magically bridged to the PSTN on the phone. But so far I cannot figure out what technology would be being used to do that. Could you make a PSTN call from the app and supply audio to and from a VoIP call? I don't think so.
Is there a way, on Android to set up a three-way conference call - one leg dials Ziber on a PSTN number - it's an inbound number to them so perhaps they don't pay much or anything for that call, another dials the American friend - it's outbound using the proxy devices plan, and then the proxy device drops out of the conference and it stays alive? Maybe.
Is it even possible to make a conference call where one leg is VoIP and other is PSTN? I'm pretty doubtful of that... I just don't think Android allows that kind of telephony / audio magical plumbing without very low-level access. So far my searches have not revealed any answers in that matter. I'm guessing there might be an answer in this document about Android telephony.
Besides this proxy-in-the-middle bridge has the additional problem - it would expose the proxy phone number since any call leg it makes to the American friend's phone number would expose its caller id and confuse the American about who is calling. The best you could do, I believe, is block the caller id which may result in the call just being declined because the American doesn't know who it is.
Another problem is that if the proxy device actively has to set up a conference call (assuming number masking issues can be dealt with) then can it do so in a way that the microphone and audio out (speaker or headset) is never active? Or that some app doesn't pop up while the owner of the proxy device is using it ie. can this all be done in the background? Like I said, I just don't know.
Is it for real?
So you have to assume Ziber have somehow nailed the proxy calling issues otherwise the ICO wouldn't be going live - although it could be that the demo so far is faked and there aren't really any proxy devices or apps, they have just built a VoIP app that is routing to the PSTN and they are paying termination charges until the ICO is over. At that point cash out and say "oops, we had problems" and walk away with one to ten million pounds (or more). That would suck - you want to believe this is real right?
If I could actually get my hands on the Android proxy app I'd be feeling more comfortable about that. Or if maybe if the bios of the team running Ziber included some real technologists who have a background in telephony and networking.
So far we have four named people:
- Mark Braun, Founder CEO - business analyst, business development and finance guy
- Jason White, Co-Founder - financial services and business management consultant
- Michael Cordy, Co-Founder - executive search professional (head hunter) and PR type
- Michail Kaufman, Co-Found CTO - a guy who did blockchain stuff as an IT guy for his Uncle
Let's just say I'm not really blown away by that list. It doesn't tell you anything about what other companies they worked for, not a single named company. Why on earth not? Okay, they may have some good business and finance background to grow a company - difficult to tell for sure. Don't you think by now they would have hired some tech heavy hitters? If so I think they really should share that info to build confidence. Even if they outsourced all that work to some guys in India (say) that's stuff that should be disclosed in an ICO in my opinion.
I did some searching on Linked.In and found one other person who advertises affiliation with Ziber - that's a guy called Nick Rozhdestvensky. He's their Chief Marketing strategist and says he was a co-director of the Moscow branch of the Founder Institute an early stage idea accelerator based in Silicon Valley. Don't you think he'd have some pretty good connections from two plus years at FI and would have been able to find some well-known people to get on board as advisors and add credibility? So far from the published bios we know nothing about them other than they are just four guys who had an idea, created a website and some Ethereum contracts for their ICO.
I was also able to find Michael Cordy on LinkedIn - at least we know he's a real person - but none of the other listed principles seem to have any kind of public profile at the worlds #1 professional networking site.
Source code
They do have some source code online in under Github account although most of the repos are empty. I did not see anything super substantial and the code is all anonymously contributed so we can't really tell who the author is. Naturally there is an awful lot of third party code in there too. The Ethereum contracts all seem to be related to the ICO crowdsale and not the operation of the Ziber network.
The multi-million dollar loophole
My other issue with Ziber is it is essentially gaming the system via a loophole - one that could easily be closed. Multi-billion dollar corporations have a way of closing ranks and working to squeeze out attempts to extract business and dollars from them. Witness the issues Uber had and is having all over the world where private individuals driving their own cars try to compete against licensed, regulated taxi companies and the Citys that regulate them. Ditto for AirBnB where they are pitting private home owners and renters against billion dollar hotels chains and City regulations.
However the difference here is that owners of cellphones have no right to those free minutes - it's part of a contract they sign with the mobile carrier. So Ziber can only work with the implied consent of the incumbents and as soon as they take note that someone is leaching free calling minutes from them the incumbents have ever incentive to change their cellphone plans to say "Nah ah, no way Jose!" and then go about blocking such usage just like they did with people trying to use their cellphones as a WiFi access point and allow laptops to surf the Internet using the phones "unlimited" data plan. Sure these efforts weren't entirely successful but it definitely did have a chilling effect. Remember, Uber is not using taxis to compete against them, neither is AirBnB sub-letting hotel rooms or anything crazy like that. Those free minutes Ziber wants to leverage exist only at the behest of the very companies Ziber wants to stick it too.
So I think even if Ziber is real and successful for a while existing carriers will quickly close ranks to block calls to or from Ziber's master nodes. This is probably why Ziber points out the ICO funds will be used, among other things, for "Hiring high-class lawyers located in various jurisdictions in the world". To me the very best outcome would be that it shines a light on the gouging cellular operators do (see roaming fees in Europe which are actually being phased out under pressure from the EU and consumer watchdogs) and force them to lower costs to the point where something as complicated as Ziber becomes irrelevant. Even without acquiescence by the mobile carriers, it is pretty clear that reliance on PSTN phone number will continue to shrink and more and more phone calls will be done using proprietary systems like Facetime, Facebook messaging, Google Chat/Meetup/Hangouts/Duo (or whatever they want to call it this week) or just plain old VoIP.
An analogy to what Ziber is trying to do
I can think of an analogy to Ziber in a different market - trying to avoid the usury ATM fees that banks in the US charge by pairing you up with a nearby individual who banks with the operator of the ATM you are standing at. They withdraw the money from their bank account for you, give it to you and a blockchain network compensates them in replacement funds instantly. Instead of paying $3 you pay maybe $1 or $0.50. If that actually became a thing (I don't think it ever would) and started impacting bank's ATM revenue fees I'm sure they would counter by just lowering interbank ATM fees until it simply wasn't worth someone's hassle to do this. And the banks would still be raking in the money (until hopefully blockchain technology kills them all of).
Conclusion
There are many questions that remain to be answered on this ICO:
- Unexplained solution for actually making it work.
- No demonstrated proxy technology
- Sketchy looking team bios that do not exude transparency
- Easily defeated business model
That said, if it was real and worked well I'd probably run a proxy just for the heck of it. For the same reason I mine GridCoin and earn a few cents a day, because I'm nerdy that way.
Will the ICO raise a bunch of money for them? For sure, even with the current slump - although I bet they wish they were launching a month or two ago... It might even actually be real and get rolled out and be helping some poor farmer or worker in a remote country where the economics make it really worthwhile and where the carriers are slow to clamp down on such loopholes. It could even become one of those technologies like BitTorrent that is annoying to some rich incumbents but just won't go away in spite of many attempts at blocking and litigation.
It might... Or it might not. So far I'm pretty skeptical. What do you think?