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A new way to make phone calls.(Up front: news / trends / advice)
Jeffrey Stanger, a political consultant in Washington, D.C., uses his Internet connection to make phone calls. He can go online anywhere in the world and place and receive calls for less than the cost of conventional phone service.
Stanger is one of about 150,000 Americans who use this technology, known as Voice over Internet Protocol, or VoIP. It's fast becoming a mainstream technology.
AT&T, Cox Communications, Qwest, and Time Warner Cable have all announced plans for VoIP service. By year's end, an estimated 1 million households will be able to use VoIP, according to Forrester Research.
"This is moving very, very, very fast," says Robert Pepper, chief of policy development at the Federal Communications Commission and co-chair of the agency's Internet policy working group. "The technology is right at the point where it's going to take off, just like mobile wireless phones did."
WHAT'S THE APPEAL?
For consumers: Lower cost. VoIP service can be as much as 40 percent cheaper than conventional calling plans. VoIP rates average $40 a month for unlimited local and long-distance calls in North America, with voice messaging, conference calling, and other services. However, VoIP requires a high-speed Internet connection, another $40 or more per month.
For carriers: Less regulation, perhaps. A VoIP call converts your voice into digital data "packets" that are sent over the Internet. The person at the other end receives the call over regular phone lines.
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