Covad Communications Group Inc. is the latest firm to join the voice over Internet protocol party by launching service this week in Chicago and 41 other markets across the country.
VoIP has become so hot that some in telecom wonder if it will become another dot-com bubble, but that’s not really a problem just yet. The problem now is sorting out the many flavors of technology that all reside under the general term of VoIP.
Covad’s offering, for example, is billed as a highly reliable service geared for small to midsize businesses. Unlike other VoIP services like Vonage, which is pitched to consumers seeking cheap phone calling, Covad’s service doesn’t ride over the public Internet.
Covad’s VoIP travels on the carrier’s leased lines and is hosted by Covad’s computers, said Bill Jarvis, the firm’s senior vice president of voice integration.
“We have full control over the quality of our service,” he said.
For users, the Internet aspect of Covad’s service will come when they use a portal to control their voice service with their computer. By using a mouse to point and click, customers can pull others into conference calls without ever dialing a phone number.
The marriage of voice and computer also enables users to look at their call logs to see who left messages so they can pull out the ones of interest without having to listen to all the messages, Jarvis said. They can also forward voice mails to other computers as if they were e-mails.
“When I talk to customers, I stress the features first and then mention that VoIP may save 20 percent to 40 percent off conventional service,” said Jarvis. “Many of these services have been around for years in one form or another, but what we do is bring them all together in one place and make them really simple to use.”
Covad’s service differs from others available to businesses in that it doesn’t require customers to buy extensive equipment to keep on their premises.
“It’s an educational challenge,” said Daryl Schoolar, a senior analyst at In-Stat MDR. “So many products out there are called VoIP and there’s a huge difference among them.
“VoIP is still in its infancy, and I think people are getting sick of hearing about it. But from everything we’ve seen, businesses are still interested in trying out the service and looking at the value.”
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Boost for toll-free: With the growing popularity of e-commerce, one might expect declining demand for toll-free numbers that start with 800 or 888. When you do a transaction on the Internet, you don’t need to use the phone.
But the popularity of Web-based shopping is likely to boost the market for toll-free numbers rather than depress it, predicts a report from Insight Research of Boonton, N.J.
The report predicts that toll-free-services revenue will grow from $10.9 billion in 2004 to almost $14.5 billion in 2009 because of the follow-up calls people make when they buy something using the Internet.
“As consumers shift from brick-and-mortar shopping to shopping online, the need for service doesn’t go away,” said Robert Rosenberg, Insight’s president. “When shoppers migrate away from brick-and-mortar stores, they know they cannot go back to a store clerk to resolve a problem.
“In this context, the toll-free call the customer makes to register a complaint or resolve an issue takes on an even more strategic role than the 800 call did when first used to build recognition in the late 1980s,” he said.