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July 5, 2003

Reach Out and VoIP Someone

Ironically, on the same day long feature on voice over IP calling appears in the Seattle Times, I receive my regular Qwest phone bill -- with an offer awfully similar to Vonage, Packet8, and Addaline: unlimited local and long-distance calls for a flat rate.

The advantage of many of the VoIP services that use hardware to handle the calls (the Cisco ATA 186) is that they route incoming calls to a number in any area code you pick -- or several area codes all routed to the same line, if you like. It's been possible to do this with some effort and cost in the past, but not with such portability: pluck your Cisco off your local network and route it over a Wi-Fi connection, on a home broadband feed, or at a friend's house on their cable modem, and you still have all your calling features and inbound calls find their way to you.

The unlimited outbound calling is a great way especially for small businesses to put a cap on costs. For $20 to $40 per month (depending on the service), you can make an unlimited number of local and long-distance calls. This takes the unpredictability out of phone bills even at five cents a minute.

Qwest's latest offers mirror these, perhaps to try to bleed some of the revenue off the VoIP services. We currently pay $25 per month (before tax) at home for voicemail, caller ID, and dial tone. Qwest is offering a $36/month package that includes 7-cent-per-minute long distance with no minimum fee and a bunch of "advanced calling features" including call waiting (which I despise).

Ratchet it up a notch and for $50/month, Qwest provides all the advanced features plus unlimited local and long distance. The hardware VoIP services also throw in most or all advanced calling features.

One of the differences: Qwest's $50/month service requires about $10/month in tax. The VoIP services aren't phone lines, so their tax burden is currently lower: more like a few bucks a month. Vonage would be about $45/month for what Qwest wants $60/month for, in other words. (Also Qwest warns that usage of more than 5,000 minutes per month puts your account in review -- hardly unlimited, but I suppose they have their reasons.)

Obviously, the local telcos have gotten wise to the threat from VoIP, but the reasons I spell out in my sidebar (no 911 service, no alarm circuits, etc.) should restrict VoIP generally to second line status for the near future.

Posted by Glennf at July 5, 2003 9:31 PM

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Comments

Posted by: John Mahar at July 6, 2003 9:30 AM