International calls are notoriously expensive, but Rebtel thinks it now has the answer. On Wednesday, the Stockholm-based company launched Rebel Calling, a patented new app that sidesteps long-distance phone networks to place calls globally without the need for an internet connection. The best part is the service will be free during 2016, with the only possible charges coming from local call carriers' call rates.
CEO Magnus Larsson and CMO Fredrik Wrahme, former executives at European telecom giant Tele2, want to change the mobile industry for good. "We're here because we believe that this market needs a revolution," Wrahme said.
The feature is the next step in the company's plan to grow its core business. Launching in 2006 in Sweden as a voice-over-IP firm, the company before now offered internet-based international calling through its app for a fee. Investors include Balderton Capital and Index Ventures. The company boasts an annual sales of $80 million, and its app is available for both iOS and Android.
Normally when a user makes an international call, the user's carrier pays a termination fee to the carrier located in the other country. That required fee is why the calls are so expensive. "That's actually a whole stock market in the world, where people trade routes and prices," Wrahme said.
Rebtel is different. Instead of actually placing an international call, the app places a local call to a server located in the country of origin, which connects over the internet to a server in the destination country. That server calls the other app user locally, so both parties are speaking internationally over what appears to the carriers as a local call.
It's attractively priced. App to app calling is free in 2016, after which Rebtel will charge $1 per month. That service currently covers over 50 countries including the U.S., or 25 percent of the world's population.
Customers have the option to take things a step further and call any phone number anywhere in the world, even if the other person doesn't have the app, with prices starting at $5 a month. The one caveat for both plans is that carriers may charge for the local call depending on the user's plan.
Rebtel knows the audience it wants to target with this new feature: young, connected people that communicate globally. "We want to find the young, multicultural millenials, because we know this product needs to be used by younger amabssadors," Wrahme said.
But in an age of WhatsApp, FaceTime and Skype, all of which offer free international calls online, persuading millenials to download another app is a big ask. Wrahme said that the company is partnering with Vice Media on an ad campaign, while a new brand is rolling out over social media. The key draw the company is marketing is that there's no need for an internet connection.
The pair hope that millenials will find the offer attractive, and they have lofty ambitions for its success. Their goal is to eventually become the number one international calling app. "Rome wasn't built in one day, but we want to be the company that finally cracked international calling," Larsson said.