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09/08/97- Updated 09:34 AM ET
PCs no longer needed to place Net calls
Consumers can now make super-cheap, long-distance phone calls over the
Internet without even touching a computer - creating a dangerous rival
for long-distance companies.
Monday, IDT unveils Net2Phone Direct, a service that lets a consumer
pick up a phone, dial a number and send the call through the Internet
to another phone anywhere in the world. The cost: 8 cents a minute
within the USA; 18 cents to London; 29 cents to Japan - all cheaper
than traditional long-distance calling.
Net2Phone Direct is the broadest service yet. Versions are being tried
by others, including units or partners of Deutsche Telekom and Japan's
KDD. Says David Goodtree of Forrester Research, "Phone to phone is
where the money is."
"It's the natural evolution of voice over the Internet," says Yankee
Group's Brian Adamik. Several software packages already let a PC user
have a voice conversation with another PC user via the Internet.
Vocaltec, the leading Internet phone company, offers a service that
connects a PC user to regular phones. But phone-to-phone can reach the
broadest number of consumers.
Net2Phone Direct works like a long-distance, dial-around service. A
user dials an 800 number or a local access number, punches in an
account number, much like using a phone card, then dials the number to
IDT's system sends the call over the Internet to a computer in
Hackensack, N.J., which dumps the call back into the regular phone
network, through which the call connects to another phone. IDT plans
to expand the system by placing its computers in more cities, so the
calls travel more over the Net (which is free) and less distance over
traditional phone lines (which cost money). Eventually, prices could
fall "to under a nickel a minute to anyplace in the country," says CEO
Until recently, major phone companies had all but ignored developments
in Internet telephony. But that's changing. Big phone companies "are
keeping a careful eye on it," Adamik says.
Last week, Deutsche Telekom announced an investment in Vocaltec. Over
the summer, AT&T and Vocaltec allied to fund an Internet telephony
start-up run by former AT&T executive Tom Evslin.
By Kevin Maney, USA TODAY
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ęCOPYRIGHT 1997 USA TODAY, a division of Gannett Co. Inc.