Playing Games with VOIP

BOSTON—The overriding theme among attendees of this weeks VON Fall 2005 Conference was that compelling new communications applications will drive uptake of VOIP technologies, and some observers feel one form of those systems may already be live.

Or rather, xBox Live, that is, referring to the online gaming service operated by software giant Microsoft Corp. in support of its Xbox video game console.

For even as Forrester Research, of Cambridge, Mass., estimates that nearly 2.78 million U.S. households will utilize Internet telephony communications tools in 2005, Microsoft alone claims nearly as many users of the Live service, which includes VOIP (voice over IP) communications capabilities for chatting among its subscribers.

Companies ranging from telecommunications stalwarts such as AT&T Corp. to upstarts Vonage Holdings Corp. and Skype Technologies—which was recently purchased by online auctioneer eBay Inc.—are pushing hard to add users to their VOIP services.

But, despite those companies focus on creating attractive calling plans to lure users from traditional phone services, firms such as Microsoft, Verizon Communications Inc. and Sony Corp., which already control gaming networks laced with VOIP, could be laying the foundation to compete in the space in the future.

Services such as Live, and Sonys PlayStation online gaming network, currently allow players to communicate with each other only within the boundaries of their own systems, but industry watchers said thats no guarantee those offerings wont add broader capabilities someday.

“Its tough to say what gaming consoles or services will offer in terms of communications capabilities, but theres no reason to think that additional [VOIP] platforms wont grow out of those systems,” said Joe Laszlo, analyst with New York-based Jupiter Research.

“All the video game system manufacturers are looking at ways to expand their communications capabilities, so theres reason to believe that a console or gaming network could become a central hub for other forms of communications technologies, including VOIP.”

The consensus opinion of people involved in the VOIP market appears to be that companies of all kinds, from telecommunications providers to less-obvious examples such as eBay, will increasingly look to add Internet-based voice services as an element of products they offer.

With legions of users already signed on, and tapping into their VOIP networks, some believe online gaming service providers could have a head start.

Even some of Microsofts closest rivals concede that gaming networks such as Live could hold significant potential for spurring VOIP adoption.

Just as Microsoft is adding VOIP capabilities to its MSN instant messaging client, portal specialist Yahoo Inc. has integrated so-called click-to-talk services into its own IM application, as have competitors Google Inc. and America Online Inc.

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