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AT&T to Offer Internet Telephone Service to Allentown, Pa.-Area Customers

Posted on: Thursday, 1 July 2004, 06:00 CDT

Jul. 1--AT&T will offer Voice-over-Internet Protocol service to customers in the Lehigh Valley and the Philadelphia area, the telecommunications provider said Wednesday.

AT&T rolled out service to 26 major markets across the nation Wednesday, including Washington, D.C., Baltimore and Albany, N.Y. The company offers VoIP service in more than 70 markets in the United States.

VoIP phone service is becoming a hot offering not only for telephone service providers but also for cable companies. Vonage, an Edison, N.J., broadband phone company, appears to have the largest number of VoIP customers, with more than 100,000 subscribers.

The technology uses a high-speed broadband Internet connection to make telephone calls, which travel at least part of the way on an Internet protocol network rather than on the public switches that make up the telephone infrastructure.

AT&T's announcement offers the potential for some much-needed competition in local phone service. The majority of Pennsylvania residents do not have a choice in their local telephone service provider.

"I think it is a form of competition," Pennsylvania's Consumer Advocate Sonny Popowsky said of VoIP. "I think it is something that is encouraging."

VoIP calls are typically cheaper than normal switched calls because the provider does not have to open a dedicated circuit as it does in traditional landline telephone service.

Interest in VoIP has surged as the quality of the service has improved dramatically. More companies are introducing equipment and services designed for VoIP telephone service.

Agere Systems of Hanover Township, Lehigh County, last week announced a new technology that will work with its network processors to facilitate services such as VoIP. British Telecom announced it will begin to replace its traditional phone network with an IP infrastructure in 2006.

Verizon Communications of New York, which is the dominant local phone provider in Pennsylvania, said last week it has begun to replace traditional switches with "soft switches" that support VoIP. It is also planning to offer its Digital Subscriber Line customers VoIP sometime this summer.

"We personally think we have an advantage in being able to roll it out to so many markets so quickly," said Cathy Martine, AT&T's senior vice president for Internet telephony, consumer marketing and sales, on a conference call Wednesday. "For the short term, there is only one national provider."

AT&T, which is the nation's largest long-distance service provider, has targeted the new technology as an expansion market in part because it allows the company to offer local calling service without paying access fees to Baby Bells like Verizon.

AT&T began rolling out a full roster of local wireline telephone services earlier this year in a number of major markets, including the larger cities in Pennsylvania. But changes in the federal regulatory landscape have forced it to withdraw from several markets. It still offers local service in Pennsylvania, but company officials say they are considering their options.

While many experts say VoIP is the future of telecommunications, some kinks exist.

People who live in areas where high-speed broadband service is not available -- such as Emmaus or Macungie -- will be out of luck. The service in its current state does not work with a simple dial-up phone connection.

Since VoIP depends on a computer, it will not work during a power outtage. That makes it hard for consumers to consider disconnecting their traditional landline service in favor of VoIP.

AT&T's service, which was available as of Wednesday, will cost $34.99 a month. AT&T is offering an introductory rate of $19.99 a month for 6 months to callers who sign up before Aug. 31.

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