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The telephone used to be the way most people accessed the Internet. Now, increasingly, people are using their Internet access to dial phone calls.
Technology giants recognize the potential for the industry. Last week, Microsoft announced it would collaborate with telecommunications company Nortel so the pair could forge ahead with software-based communications products. And, last year, eBay bought Internet-based phone service Skype, in part because the company expects the PC-phone service to make it easy to chat online about transactions at the auction site.
Consumers face a huge number of choices. More than 1,100 U.S. companies offer Internet-based telephone service, according to a report published in October by Forrester Research.
And the victims could be landline phone providers.
A call for change
"Charging for calls belongs to the last century," has become the mantra of Niklas Zennström, Skype co-founder and chief executive.
For now, his claim is a bit of a stretch. The vast majority of Americans pay when they make calls -- and most make calls by using a telephone. And even those who have turned to Internet-based calling plans that allow use of telephones, such as Cablevision's Optimum Voice, pay monthly fees.
Last week, Cablevision said that since 2003 it has lured more than a million customers to its $35-a-month unlimited long-distance calling service, which routes telephone calls through the company's high-speed Internet service, using a special modem.
Another Internet-based phone service, the widely advertised Vonage, has lured 1.6 million customers in just three years.
The free PC-based services, on the other hand, have no monthly fees, merely requiring use of free software available online and a headset hooked into a com.puter.
Despite the potential savings with Internet-based services, especially on international calling, few Americans have jumped onto the technology. Four out of five said they hadn't even heard of such voice-over-Internet phone services, according to a study released last month by Forrester Research, a technology research company in Cambridge, Mass.
Eric Mastrosimone, store manager of the RadioShack in Huntington Station, said some customers have only a vague notion of the offering and ask "What's this Internet calling I can get for free?"
A threat to phone companies
"I don't really see Skype and phone-line replacement companies as big competitors" with each other, said Eric Laughlin, chief executive of Voip.Review.org, which reviews the calling services. "I see both of them just stealing from the traditional telephone companies."
PC-based calling services essentially provide instant messaging with voice. Yahoo, AOL and MSN all offer the service. And Skype, founded in 2003, has attracted 113 million registered users worldwide, a 20 percent increase from just three months ago, the company said last week.
Some people find they're relying on more than one calling service. Eddie Gomec uses Vonage as an inexpensive phone service. But he also uses Skype to search people's profiles and chat with them. "I've had many conversations with many people all over the world for free," said Gomec, a business partner with Together, a dating service based in Manhattan.
The PC-based services also offer phone numbers, usually for an extra charge, that enable customers to receive calls from telephones. And outgoing calls to regular telephones start at about 2 cents a minute.
Some consumers, including Matt Blackington, 48, a Burke, Va., resident who was surfing the Internet at a Starbucks in Melville while here on business last week, feel they have enough ways to communicate without the addition of PC-to-PC calling. "I'm just very comfortable with what I use," he said.
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