Business

Calling all tech-heads

In a recent survey, consumers said they thought "VoIP" could be a hybrid European auto or a low-carbohydrate vodka. But VoIP - which stands for Voice over Internet Protocol - may soon become a household term as major telecom providers such as Verizon, America Online, AT&T and even Qwest are taking such Internet-based telephony services to mainstream consumers. VoIP is available to anyone with a broadband, or high-speed, Internet connection - about 420,000 Arizona households, based on industry estimates. By routing calls over Internet data lines in digital "packets," VoIP avoids the cost of the traditional public phone network. The consumer cost of VoIP services ranges from free for phone calls between members of services such as Skype, to $20 to $30 for unlimited local and domestic long-distance service from companies including Vonage and Net2Phone. While that doesn't include the cost of a broadband connection, heavy long-distance users can save some real money using VoIP. "With Skype, we can really save on expenses when we call places like Great Britain," said Joe Rotello Jr., founder and owner of WindowGroup, a Tucson-based Internet consulting and training company. Rotello, a Tucson native who currently is dividing his time between the Old Pueblo and Knoxville, Tenn., uses Skype for his business and has used Vonage - one of the largest residential VoIP providers - at his home in Knoxville. "The voice quality has really improved - it's about FM-radio quality," he said. After finding customers mainly among tech-savvy businesses since emerging in the mid-1990s, the VoIP industry is counting on a lot more people like Rotello to adopt Internet telephony in the next five years. In a recent report, the Frost & Sullivan business consulting firm said residential VoIP is "moving beyond the early adopter and becoming a mass market." The firm projected that the number of residential VoIP users will jump from 1.5 million last year to 18 million in 2010, with revenues rising from $295 million to more than $4 billion. You can find VoIP "starter kits" and phone adapters at retail consumer electronics stores such as Best Buy and Radio Shack, which recently rolled out Skype kits. Several drawbacks

While the industry clearly believes mainstream consumers are ready for VoIP, some consumer advocates and industry experts question whether VoIP is ready for the mainstream. Critics point out that voice quality on VoIP calls can be uneven, the service won't work when Internet connections go down, VoIP doesn't work with 911 emergency service in many areas, and online-based services require self-installation that can be daunting to some consumers. "It's ready for the tech-savvy mainstream," said Michael Gikas, associate editor for electronics at Consumer Reports. To install VoIP, "you really should be comfortable working with your computer. … But in terms of operation, it's easy," Gikas said. VoIP also can save money on long-distance rates and calling features, such as Caller ID, that usually are included in VoIP plans, Gikas said, adding that VoIP plans also don't carry various telecom taxes and surcharges. "If you're not making many long-distance calls, you won't realize those benefits," he said. Gikas advises consumers to carefully weigh different rate plans, considering their long-distance usage, and read the fine print in service agreements, which can include such things as fees for early termination of service contracts. "It's not terrible"

In a recent study, Keynote Systems, an Internet performance consulting firm, found that VoIP providers have some work to do to match the quality of traditional phone service. "While it's not terrible, certainly you do not have the kind of service consumers are accustomed to with traditional phone service," Keynote spokeswoman Della Lowe said. For example, Lowe said, some services suffer "echoes," or delays in voice transmissions. "That makes for an unpleasant experience, and key parts of the conversation could be lost." A spokesman for Vonage - which ranked first in overall reliability in the Keynote study - said VoIP service is a viable alternative to traditional phone lines, noting that the company has more than 1 million subscribers in the United States, Canada and the United Kingdom. "The service is improving, and Vonage continues to work to improve its quality," Vonage spokesman Mitchell Slepian said. Businesses like VoIP not only for its low cost but for its mobility and flexibility, which allow users to make and receive calls anywhere they can open an Internet connection. As information technology manager for UApresents, Tucsonan Todd Erickson has watched visiting performance troupes fire up their laptops via wireless Wi-Fi connections to make long-distance VoIP calls. "It's very portable, and it's free long distance for them," Erickson said. But Erickson said VoIP doesn't seem worth the hassle for his own use. "You have to make a lot of long-distance calls to make it worth it."