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To a growing number of computer users, a phone call
is simply a verbal e-mail. But to traditional phone
companies, it sounds more like a threat.
The technology to make calls over the Internet has
been available for several years. Sometimes known as
Internet telephony--or Voice over Internet Protocol--it
is poised to take off, and traditional phone companies
and government regulators are turning up the scrutiny.
Voice calls carried over computer networks can do things
not possible on the networks operated by phone companies.
Arranging a call-in conference among half a dozen people,
for example, can be as easy as dragging the names of
each person into a virtual conference room on a computer
screen and pushing a button to connect everyone.
Voice mail messages can be identified and ranked on
the screen and even answered by e-mail. And video can
be added by attaching a small camera to the mix and
activating some software.
While providing more features, VoIP technology usually
costs less than traditional phone service because it
rides on data networks and doesn't require the costly
switches and other equipment necessary for a circuit-based
voice network.
Internet telephony
also is free of the numerous regulations, fees and
charges applied to regular phone calls.
While traditional phone companies like SBC Communications
Inc. and AT&T Corp. carry data on their networks,
they make most of their money from voice traffic, said
Paul Butcher, president of Mitel Networks, a company
that provides integrated computer/phone systems.
VoIP undermines that revenue stream, he said.
"Phone companies would like to kill it, but they can't.
It's like the music industry and Napster. Pirating music
on the Internet is illegal, but even so the industry
can't stop it," he said. "VoIP is legal, so it's even
harder to stop."
Several state utility boards have looked at imposing
charges and fees on VoIP, and earlier this year regulators
in Minnesota tried doing it. The move was blocked by
a federal judge who cited federal laws that exempted
Internet technology from fees and regulation.
But it remains a gray area.
Meanwhile, a survey released recently by CompTIA, an
information technology trade association based in Oakbrook
Terrace, Ill., found that about half of small- to medium-sized
businesses are looking at buying integrated computer/phone
systems when they replace current equipment in the next
two years.
Companies with multiple locations and a mobile work
force are especially open to the new technology, said
Edward Migut, a CompTIA executive.
"It's a matter of evolution," said Migut. "Everything
in information technology is moving toward the IP platform.
The Internet is much more stable now than it was just
a few years ago. Smaller businesses are getting more
comfortable with it."
Chicago attorney Thomas Stilp has embraced VoIP. Stilp,
who has a law office, a real estate business and a manufacturing
company, was looking to simplify his communication needs.
The integrated computer/phone system he got from Mitel
Networks, based in Ottawa, Ontario, enables Stilp to
get calls from his 312-area phone number whether he's
in his Chicago Loop office, his Evanston factory, or
his North Shore home.
It also gives him the same computer screen regardless
of location.
"I can work on a legal brief in my office, turn off
the computer and go home," he said. "After dinner, I
can go to my home computer and find the brief exactly
as I left it at the office. People call my office phone
number, and I pick up no matter where I am.
"It's great because clients think I'm always working
in my office."
A more striking example of Internet telephony's versatility
unfolded earlier this year in the Arctic Circle.
Stephen Braham, of Vancouver, Canada's Simon Fraser
University, was the chief field engineer on a NASA-supported
project that tests equipment bound for Mars. This is
done in a giant arctic crater that provides as close
an approximation of Mars as can be found on Earth.
In past arctic trips, Braham and his colleagues used
a satellite phone to talk to the outside world, but
at toll rates topping $1 a minute, it wasn't ideal for
an academic program with limited funds. "Also, with
a satellite phone, you have to be outside and stay in
position to catch your signal," he said.
This year, the researchers added Internet telephony
to a high-speed broadband satellite Internet connection.
"We got a dial tone that let us call anywhere," he
said. "If we called others on our network, the call
was free. Even if we dialed others outside our network,
the calls were billed as if they originated from Southern
Canada, which is way cheaper than sat-phone rates."
For more mundane pursuits, VoIP is catching on as well.
Mitel's Butcher said that at his firm VoIP units constituted
40 percent of his shipments in the last quarter. In
the coming quarter, he expects they will comprise a
majority of his sales.
Legal and other issues, however, remain to be determined.
One concern is how 911 emergency calls will be handled
on VoIP, while another is the ability of police authorities
to wiretap Internet conversations. Those sticking points,
among others, assure that the Federal Communications
Commission will revisit its hands-off approach to the
technology.
Still, the new technology won't really take off until
major carriers use it to replace existing networks,
said Blaik Kirby, a vice president with Adventis, a
Boston consultancy.
"Sprint has been an early-adopter in using VoIP in
its local service networks," said Kirby, "and it's had
fair success with it."
Qwest Communications Inc., the dominant local carrier
in the nation's Western states, said recently that it
would introduce VoIP service in Minnesota.
And in Illinois, while Verizon is looking to protect
its traditional voice phone business, the firm is also
promoting VoIP. Verizon supplies it to business customers
in Chicago in competition with SBC.
Dave Sherman, Verizon group marketing manager who oversees
its Chicago Internet telephony business, said the firm
is using Chicago and other markets to learn more about
VoIP and how to market it. Because the new technology
competes with traditional phone service, the company
cannot ignore VoIP.
"It is analogous to wireless service," Sherman said.
"When wireless started, people said that it would take
business away from the wireline network. Our company
had to decide, 'Did we want to be in wireline or wireless?'
"We decided we had to be in both."
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