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VoIP - New Way For Calling

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Voip Now Becomes New Way For Calling

September 19, 2004

By Chris Dumond

CINCINNATI -- Cincinnati resident Patricia Jackson has never been afraid of technology.

Jackson is one of the first to take advantage of Time Warner Cable's new venture into Voice over Internet Provider (VoIP) telephone service here and she says it works great.

"The price is right and I haven't noticed any difference in the sound," she said.

The prospect of unlimited local and long-distance calling for less than $40 per month was too much to resist, she said.

Commercial Voip telephone service has been available in the United States since 2002. Traditionally, the technology sends packets of voice information over the Internet instead of using copper telephone wires.

What's new is that cable providers like Time Warner are using their existing cable and fiber optic networks for the phone service. Cable providers claim their secure networks allow for better quality control compared to other Voip providers like Vonage, which typically use the public Internet.

Lindsay Schroth, a senior analyst with The Yankee Group, a leading telecommunications research and consulting firm, said phone companies are taking a hit from the VoIP/wireless combination in competition. The cable companies are also giving other Voip providers a run for their money, Schroth said.

While providers like Vonage allow customers to select phone numbers from anywhere in the country and to make those phone numbers portable, the mass market wants a Voip service that is similar to traditional phone service, but cheaper, she said.

She said the cable companies can provide that along with arguably better sound quality.

How traditional telecommunication companies will successfully compete is yet to be seen.

"I think they're very threatened," she said. "There's not many people in the market who don't think everyone's going to be getting IP phone service."

Howard said Time Warner has been slow to roll out the service here, trying to make sure any problems were fixed before it was released to the general public.

Cable's Voip offerings work with regular telephones. During installation, the cable, just like the one that plugs into the back of the television, is wired into the home and connected to a modem that serves the Voip service. It can be used for high-speed Internet access. From there, a phone wire from the modem can be plugged into any phone outlet in the dwelling, making the Voip service available to all phone jacks in the home.

Howard said the modems and installation are free.

If a Voip customer call needs to be routed outside Time Warner's network, the company has an agreement with MCI to provide service. Folks with traditional phone service can call Voip users and vice versa, he said.

For those without any other Time Warner services, Digital Phone costs about $45 per month before taxes. With Time Warner's high-speed Internet service, the bundle costs about $80 per month.

"The biggest thing was the cost," Jackson said. "The kids are always on the phone and it's nice not to have to worry about long-distance charges."

She said she considered removing landline telephone service from her house entirely, but wanted to keep a telephone for the possibility of working from home. After shopping around, she said, she settled on Time Warner.

She said she has had some problems with caller ID and would like to have more services like three-way calling. Jackson said she didn't have a problem with most frequent complaints of Voip users.

First, when the power goes out, so does VoIP. Howard said market research showed that was not an issue for 80 percent of Voip customers.

Digital Phone service can also render DSL Internet access unusable unless the DSL access is installed on separate phone lines.

Not everyone who is a Time Warner customer can get the service. Howard said he expects Digital Phone to be available to about 80 percent of the market by the end of this year. Some fear of technology and quality concerns exist, he said. After a year of availability in Portland, Maine, about 10 percent of those who can get the Time Warner service have signed up.

However, a report issued last week by The Yankee Group, claims cable companies will overcome other Voip providers within the year, breaking open the Internet protocol phone market.

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†AK and HI residents pay $29.95 shipping. ††Limited time offer. Valid for residents of the United States (&DC), 18 years or older, who open new accounts. Offer good while supplies last and only on new account activations. One kit per account/household. Offer cannot be combined with any other discounts, promotions or plans and is not applicable to past purchases. Good while supplies last. Allow up to 2 weeks for shipping. Other restrictions may apply.

1Unlimited calling and other services for all residential plans are based on normal residential, personal, non-commercial use. A combination of factors is used to determine abnormal use, including but not limited to: the number of unique numbers called, calls forwarded, minutes used and other factors. Subject to our Reasonable Use Policy and Terms of Service.

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