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Cheap VoIP Services
Challenges for cheap VoIP services
April 9, 2006
By: Alice Osborn
According to John C. Dvorak of PC Magazine, cheap VoIP
services will soon meet their end. In his article, "The
Coming Death of Cheap VoIP," he describes how the major
phone companies will take over VoIP, rename it "digital
voice," and render cheap VoIP service providers obsolete.
They will do this by addressing the new E911 service
requirements and by making broadband services incompatible
with discount VoIP services, such as
Skype
that offers free computer-to-computer phone calls. I agree
with Dvorak in that the large telephone companies have the
E911 advantage, but disagree that Skype and other bargain
VoIP services will be going away any time soon.
The E911 issue
This May 2005, the FCC ruled that VoIP service providers
must support 911 services within a 120-day window. To
comply, a VoIP service must have their 911 calls sited by
emergency services to where the caller physically is, rather
than where the virtual VoIP number might be located. Large
telephone companies will do a better job of partnering on an
E911 solution with the cable companies than will the
discount VoIP services. A BellSouth or Time Warner has the
infrastructure, labor force and massive budget to quickly
maneuver around the 911 structural costs, which could pose a
daunting obstacle to a bargain VoIP provider. While the
large companies would absorb the new E911 costs, the smaller
VoIP companies would have to pass on these fees to their
budget customers not used to extra charges for many of their
so-called free services.
What about Skype?
Dvorak states that the major telephone companies will
force Skype and the other independent VoIP services out
because DSL or broadband licensing agreements will not allow
users to hook up other VoIP services not associated with the
DSL provider. On the other hand, I believe that Skype will
find a way to circumvent the telephone companies' hardware.
Skype is already the fastest growing telecommunications
company in the world with 40 million users, and it achieved
this feat by being cheap, fast and smart. Users only need a
broadband connection, Skype's software, and a microphone or
special handset. This VoIP company will find a chink in the
big telephone company's armor, and find a way to stay
competitive before those companies can react. Perhaps other
independent VoIP services may not stay long in the telephony
business like Skype, but they will keep the marketplace
competitive and let the customers choose their VoIP
services, rather than having these services chosen for them.
What's next?
As VoIP becomes a more mainstream service, there is the
possibility of the major telephone companies taking over
most VoIP services. However, analysts like Dvorak may be
missing the strength and vitality of smaller VoIP firms like
Skype, that are able to provide to their customers discount
and quality VoIP services. The coming year will supply the
answers to these challenges, brought on by the new E911
regulations and by the entry of telephone companies into the
competitive VoIP playing field.
About the Author
Alice Osborn is a successful freelance writer and
contributor to Audio-Conferencing-Guide.com. Your definitive guide to everything you need to know about
audio driven communications, including audio conferencing,
conference calling services, and VoIP telephony for business
and personal use.
Also See: [
How free are
free conference calling services? ]
[ VoIP service
provider regulatory issues -- new E911 requirements
]
[ Companies must
evaluate VoIP service providers with their security concerns ]
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