By Ellen Muraskin  |  Posted 2004-06-14 Print this article Print

Not to mention the companies that have sprung into being as VOIP service providers, which are mushrooming fastest of all. These can be classified into two supercategories. First are those that provide the access method, such as Santa Clara, Calif.-based Covad/GoBeam and its (historically, primarily) DSL connection, or Atlanta-based Cbeyond Communications and its T1. Second are those that leave the broadband acquisition up to the customer and simply register the subscriber to its central softswitch, app servers and media gateways.
Here find your $20 to $40 packages from Edison, N.J.-based Vonage; your consumer (not your business) packages from MacLean, Va.-based Primus Telecom; North Brunswick, N.J.-based VoicePulse Inc.; Lowell, Mass.-based BroadVoice Inc.; Kansas City, Mo.-based Nuvio Corp.; Newark, N.J.-based Net2Phones VoiceLine; Santa Clara, Calif.-based 8x8s Packet8; and scores of others.
Click here to read about Lingo, an all-you-can-talk VOIP service from Primus that sets a new price floor. Most of those above, with all-you-can-eat or tailored consumer packages, offer a range of IP Centrex packages to businesses as well. These can go beyond the broadband limits of a DSL connection, and may work in tandem with legacy PBX and gateway. Some, such as New York-based M5 Networks Inc., are thus far entirely focused on the IP Centrex space. And then there are your downloadable, VOIP-focused freebies, such as Jeff Pulvers FreeWorld Dialup and Skype Technologies SA. The latter will go the route of some brethren by launching a paid service that gateways out to the PSTN (Public Switched Telephone Network). So, what has happened to tempt the new wave of VOIP entrants? The easiest answer to understand is that the technology has improved and has been proved by widely promoted services such as Vonages. "Vonage proved that SIP [Session Initiation Protocol, a favored VOIP signaling protocol] worked," says a widely quoted SIP guru. Lynda Starr, vice president of carrier research at Cedar Knolls, N.J.-based Probe Group LLC, agrees. She adds that carriers got smarter about network buildout, relying on open broadband Internet connectivity to reach subscribers—at least on the consumer and small-business end—and simply sending that subscriber a packetizing terminal adapter that would register a dynamic IP address to the central server. This became more reliable, of course, with the wider spread of broadband. The other change has been regulatory: The FCCs February 2004 ruling on Pulvers FreeWorld Dialup service, which offered free IP calling to anyone else on the network, determined that for now at least, VOIP that never touches the public switched network is a data application. As such, it is not subject to universal service charges and other state and federal taxes, which can make up well over 25 percent of a residential phone bill. This has given VOIP providers a tremendous price advantage and forced the traditional telcos to IP-ify their own voice services. "The LECs [local exchange carriers] are terrified," my SIP savant says. "Sixty-five percent of Verizons voice customers are exposed to Comcast." But the regulation story is certainly still being written, and major developments have been filling up the business pages. The RBOCs were told last week that they could discontinue the discounts theyd previously been forced to give competitors for access to their switches—what the Telecom Act of 1996 referred to as "unbundled network elements," or UNEs. On Thursday, long-distance carriers and state regulators appealed to the Supreme Court to block that decision, in effect continuing to enforce the discounts for competing providers. Next Page: Building telco bypass roads

Ellen Muraskin is editor of's VOIP & Telephony Center. She has worked on the editorial staff at Computer Telephony, since renamed Communications Convergence, including three years as executive editor. Muraskin's work has also appeared in Popular Science magazine and other publications.

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