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On Sep 30, 2016 at 00:48:03

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On Aug 30, 2016 at 10:38:01

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Bell Competitors Set To Unleash Voip

January 5, 2004

By Lance Williams

They're getting in line to try to ring Bell's bell.

This year, several competitors will try to grab a portion of Cincinnati Bell's dominant position in the regional residential telephone business using a fast-growing technology called voice-over IP technology, or VoIP.

Simply put, Voip allows voice calls to be digitized and sent over the Internet or cable lines, as opposed to routing calls over the traditional circuit-based phone lines Bell uses.

For consumers, whether business or residential, Voip can mean lower prices and a multitude of new features and options. Bell, with more than 1 million customers, stands to lose the most as the Voip residential market heats up:

Time Warner Cable is expected to begin offering unlimited local and long-distance calling using Voip sometime during the year. The company announced its intentions with a filing with the state Public Utilities Commission this fall. Time Warner already is offering the service in test markets in Maine and North Carolina. It currently has 350,000 customers in Greater Cincinnati, presumably a majority of whom also use Bell as their local phone service provider.

AT&T is planning to roll out a new Voip consumer offering in the top 100 markets in the United States. It joins other traditional telephone and cable companies expected to jump into Voip in 2004, including Qwest, Comcast, Cablevision and Cox Communications.

Insight Communications could launch Voip phone service in Northern Kentucky for its cable subscribers next year. The company already offers unlimited local and long-distance calling in Columbus and its Louisville and Lexington markets in Kentucky.

For its part, Cincinnati Bell has offered Voip options to its business customers for more than two years, but has no plans to expand it to the residential market. Rather, Bell hopes to not only maintain, but to grow its residential customer base by touting its customer service and bundled services -- telephone, Internet and wireless on one bill -- rather than by competing on price alone.

"We view (VoIP) as a technology and not as a product unto itself," Bell spokeswoman Elizabeth Korosec said.

Just a couple of years ago, making residential telephone calls over IP was largely a geek's game, requiring a user to sit at a computer and use a microphone or clunky headset to communicate with someone using similar software. Quality ranged from mediocre to downright awful.

But the technology has improved. VoIP's call quality still lags behind traditional phone service, but experts say competitive pricing and enhanced features might start luring customers away from the traditional phone companies across the country.

"(This) is going to be a big year for VoIP," said Doug Oppenheimer, president of Tel-Data, a Cincinnati firm that installs communication systems for business customers. "It will be as monumental as the advent of the fax machine."

The technology has improved enough to give providers confidence they can compete in the consumer market.

"We are going to be very aggressive when we deploy it," said Keith Cocozza, spokesman for Time Warner Cable in Stamford, Conn.

The company, which has about 18 million cable subscribers across the country, has joined forces with Sprint and MCI to be able to offer Voip to customers nationwide.

In test markets, Time Warner is offering its cable and high-speed Internet customers unlimited local and long-distance service for $39.95, while nonsubscribers can receive the telephone services for $49.95 a month.

Insight's offering in Columbus combines cable, high-speed Internet and telephone services and begins at $79.95 a month. No specific details are available for the company's Northern Kentucky game plan, but company officials said the service is in the works.

"It's definitely a high-priority market for us," said Kim Messina, vice president of communications for Insight.

There are other offerings in the market already. Vonage, a New Jersey-based company, offers flat-rate calling to broadband Internet users beginning at less than $30 a month. The company is growing quickly, but still has just over 50,000 users -- barely registering a blip nationwide.

Besides flat-rate pricing, analysts say the real promise of Voip is the expanded services it can provide business and residential users alike.

AT&T's Voip services for business, for instance, allow companies to run voice, video and data over a single system and access all e-mail, voice mail and fax messages from a single mailbox. It's attracting attention -- AT&T reported a fourfold increase in the past year.

The same expanded services can apply to residential customers, too. They can use services such as conferencing for up to 10 people, detailed call logs and do-not-disturb functions.

But the service is not tied to a single household. Voip allows users to take their phone number with them. A business traveler can take an adapter with him that lets him receive home telephone calls in a hotel room.

Still, the technology has its drawbacks. Because it doesn't run off traditional telephone systems, a power outage could disrupt Voip telephone service, and many Voip systems don't allow users to make 911 calls.

Call clarity also suffers somewhat with VoIP, although the technology is improving. Time Warner, for instance, signed the deal with MCI and Sprint so that it can route its Voip calls through the telephone companies' phone networks to reach users in the traditional format.

All of this can happen, too, outside the boundaries of government regulation. Time Warner filed its plans with the Public Utilities Commission of Ohio, but the step wasn't required by law.

Currently, Bell has more than 43 percent of its customers in a bundled plan. Of its wireless customers, upward of 50 percent include that service as part of a bundle.

Bell argues that Voip hasn't proved that it's a better way yet.

"Until we find a reason to believe it's more reliable or more effective," Korosec said, "we will continue to use the system we've always used."

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