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Rich Tehrani, Group Publisher One Less Wire

President and Group Publisher

[January 7, 2000]

The Quiet Growth Of Internet Telephony

With all the talk of e-commerce during this past holiday season, you would think it was the only technology business experiencing rapid growth. A recent announcement from ITXC, a Tier 1 carrier of Internet telephony, corrects that perception quite convincingly.

ITXC places Internet telephony growth -- as witnessed on their own network -- an order of magnitude greater than that of online shopping. According to ITXC estimates, e-shopping (as they call it) tripled in growth this holiday season. But the volume of calls on the ITXC Internet telephony network increased 15-fold to 1.5 million minutes -- most of which were international calls.

Reduced rates, it seems, are having a tremendous effect on the amount of time people spend talking on the phone. Most people don't even know they are using the Internet as a transport mechanism for their telephone calls. I, too, spent many hours speaking on the phone this holiday season. I easily topped more than 10 hours to South America.

But not everyone's experience using Internet telephony is ideal: one of Internet Telephony magazine's columnists, Robert Hashemian, recently detailed the ordeal he went through trying to get a new Internet telephony service provider.

There are so many opportunities to have customers use Internet telephony service that new ideas are constantly evolving to allow access to Internet telephony networks. An idea that has been floating around for a while is connecting a phone handset to the back of your PC. One company providing such a device -- for just  $25 -- is Riparius Ventures.

A recent unique approach comes from Panasonic: They allow a telephone to have the ability to use the PSTN or an IP telephony network depending on the user's preference, sans PC. A simple button on the phone makes this happen. I like this approach as it makes it easier for a customer to decide how they want to communicate and how much they want to spend on the call. Currently, this phone only works on the Net2Phone network. I have logged many hours on this network myself and can vouch for its quality. Be forewarned, however, that the quality of Internet telephony calls varies greatly depending on where the call originates and terminates.

The good news is that Internet telephony usage is growing exponentially, and the better news is that companies continue to find new ways for us to take advantage of VoIP. We can only hope that this innovation will continue as more companies realize the potential this market offers.

Rich Tehrani welcomes comments at rtehrani@tmcnet.com.

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