Battle begins as AT&T, Vonage drop prices of Internet phone services.

Byline: Doug Bedell

Oct. 2--Drops in pricing for two major Internet phone services signal the start of a price war as providers struggle to attract consumer attention, some analysts said Friday.

The rate cuts raise the question of whether anyone will ever make any money selling Internet-phone service, which is also known as voice over Internet protocol, or VOIP. But AT&T and Vonage, the two providers who slashed monthly fees by $5, have differing takes on whether further cuts will be necessary.

"We think it's probably pretty much bottomed out...," said AT&T spokesman Kerry Hibbs. "We can't go down $5 every month."

Vonage spokeswoman Brook…