• E-mail
• Print
• Comment
• Font Size
• Digg
• del.icio.us
• Discuss article

SBC Hooking Up Internet-Based Phone Service

Posted on: Saturday, 20 November 2004, 12:00 CST

NEW YORK -- SBC Communications Inc. will begin residential Internet-based phone service in January to deter customers from switching to cable and wireless phone competitors.

The service, which uses high-speed Internet connections, is being tested by 1,000 customers in Los Angeles, Dallas, Chicago and San Antonio, chief executive Edward Whitacre told Blooomberg News on Tuesday. He said it will be offered in all 13 states served by SBC - - Oklahoma among them.

Regional phone companies such as San Antonio-based SBC and New York-based Verizon Communications Inc. are adding Internet calling, generally priced lower than conventional service, to match offers from cable television and wireless-phone companies.

The service -- called VoIP, or voice over Internet protocol -- will help SBC keep its 5 million customers who buy high-speed Internet access service, Whitacre said.

"We understand that IP is the future," Whitacre said in New York at a UBS AG conference.

SBC customers disconnected 654,000 conventional phone lines in the third quarter. That left the total at 52.9 million, a 4.2 percent decline from a year earlier.

VoIP service is less expensive to provide than conventional calling, in part because it is subject to fewer government regulations. Calls and Internet traffic can to be carried over the same network, reducing the need for circuit switches and other network equipment.

More than half of SBC's customers buy two or more services, such as voice and digital subscriber line, or DSL, Internet access, the company said last month, That's up from 36 percent a year ago.

SBC has not disclosed how much it will charge for the Internet phone service.

The company said last week it will spend about $4 billion to build a high-speed network for video and Internet access. The fiber- optic network will be available to about 18 million homes and businesses by the end of 2007, SBC said.

VoIP will give customers another reason to stay loyal to SBC until that rollout is completed, analysts say.

Verizon, the largest local-phone company, started its VoiceWing Internet calling service for residential customers in July. It charges $34.95 a month for unlimited local, toll and long-distance calling nationwide.

Cablevision Systems Corp., the largest cable-television operator in the New York area, sells unlimited calling for $34.95 a month.

Source: Tulsa World

More News in this Category