You're at work and hear what you think is your phone. You pick up the receiver, but all you hear is a dial tone. Puzzled, you pick up your cell phone, and the only things on the display screen are the date and time. Then you notice that a message has popped up on your computer screen saying "Mom."You quickly plug your headset into the computer and click on the incoming call.

The above scenario describes a new softphone user with Voice over Internet Protocol adjusting to the newest in telephony technology.

Yet while advanced technology crept into nearly everyone's pockets with the explosive adoption of cell phones over the last 10 years, the newest in telephony is experiencing slow adoption rates as the technology begins to crawl back to user's desktops with VoIP.

In a January paper prepared by Forrester Research, 1,132 online households were surveyed about VoIP, and less than half - 43 percent - said that they had ever heard about it, only 3 percent indicated that they were currently using a paid VoIP service, and just 13 percent were interested or very interested in the technology.

Many providers and users are confident, however, that the technology, or a hybrid of old and new telephony, will replace regular phone systems relatively soon.

"It's a matter of when, not if," said Mark Lyons, vice president of sales for the value-added resellers channel at Vonage, a VoIP provider headquartered in Edison, N.J.

VoIP comes in a variety of forms, but all transmit signals over a broadband Internet connection in the same way e-mails are transmitted. Packets of information, in this case voice, are assembled when someone is talking, broken up into smaller packets, sent over Internet broadband lines and then reassembled when they reach the final destination - another computer, or a cell phone or regular phone, depending on the service provider.

In early October, AOL became one of the newest additions to the VoIP marketplace with TotalTalk, a PC-to-PC softphone and a PC-to-phone VoIP service embedded into AOL's newest instant messaging application, IM Triton. At the same time, Microsoft and phone company Qwest are partnering to enhance Qwest's presence in the VoIP marketplace - they're in 14 states to date.

There are a variety of ways for a consumer or a business to implement VoIP.

The most costly is buying the hardware version - VoIP phones. These phones, which look like traditional business phones with transfer, conference and voicemail options, range in price from $100 up into the thousands. They are automatically configured with a static IP address, so that no matter where a user plugs in the phone, as long as there is a broadband connection, the phone number remains the same.

Many companies, like Jefferson, Mo.-based CPA firm Bert Doerhoff CPA PC, turned to a hybrid system of their regular phones using VoIP technology. These firms buy adaptors through providers like Vonage, BroadVoice or 8x8, or a retail store, and plug their existing phones into the VoIP adaptors, with the other end plugged into the broadband connection via a modem or router.

Businesses using this service can either pick several area codes for their phone number so as to appear local in many different states, or they can set up toll-free numbers for their different branches so no clients ever have to dial long distance.

"The biggest advantage [of VoIP] is to be sitting in a hotel room and you are able to go into the system and get all your messages, return calls and use the laptop like a phone," said the firm's president, Bert Doerhoff. "It makes the office that much more transparent, and the client doesn't even know you're not even in."

Cost savings

By using the Internet for voice communications, fees such as long distance or international charges are minimized, and many services offer free fax lines, as well.

Vonage offers a small business package of up to 24 lines for $49.99 per month with a free fax line and unlimited phone calls within the United States, Puerto Rico and Canada. BroadVoice offers a single-line plan for $29.95 a month with unlimited calling throughout the United States and four other countries of the user's choice.

Verizon's VoiceWing offers a one-line unlimited plan for $34.95 without a Verizon DSL connection; with a Verizon DSL connection, the price of the plan drops to $29.95.

But some warn against a DSL connection for those who want to download data and talk online simultaneously.

"A DSL connection is not a good idea," cautioned Gene Cornfield, a spokesman for VoIP provider BroadVoice. "If [the consumer] has a T1 or T3 connection, they have plenty of bandwidth, so no matter who is downloading stuff off the Internet, there is still plenty of bandwidth to use for talking."

All three providers listed above offer basic phone services for free: call forwarding, call waiting, voicemail and 911 access - new VoIP services.

Those cost savings could all change, however, if Congress passes a federal tax on VoIP services much like the ones currently in place for regular phone systems.

"As soon as the government feels enough pain, it's going to strike," said David Cieslak, a CPA and principal in the Encino, Calif.-based computer consulting firm Information Technology Group Inc. "The government is not going to come out a loser."

Even with the prospect of long-term savings, however, implementing a VoIP system can be pricey. For those whose phone systems do not need upgrading, the cost may not be justified, as was the case with Practical Software Solutions, a reseller of MAS 500 headquartered in Concord, N.C.

"We already own one building; we bought a second building and were looking to update that building's phone system," said Vince Stamey, the chief executive. "We sold that second building, and so the cost to upgrade our present building to VoIP didn't justify a four- to five-year-old [phone] system. If I had to replace the system here one day, though, I would definitely choose VoIP."


Some of the biggest attractions - beyond the cost savings for long distance and international phone calls - are the features that VoIP services can provide that are not available with regular business or home phones.

CounterPath Solutions Inc. is just one software company that has created softphones for VoIP users. These softphones allow VoIP users to answer their phone with their broadband connection on their computer, or with a Counter Path Pocket PC - a Wi-Fi phone. Softphones also allow users to integrate different address books from Outlook, their softphone address book, and a customer relationship management contact listing for a one-click dialing feature, as well as receiving voicemails in the form of e-mails to their inbox.

Verizon's VoiceWing offers customers the choice of a detailed call forwarding system, where users can split the forwarding between their cell phone, their home phone and their business phone depending on their location, and can set the system to allow certain phone calls through, while sending all others directly to voicemail.

Multiple phone rings is another feature available through many providers like Vonage and Verizon. A user can pick usually up to three numbers for their VoIP phone service to ring at one time, so the user never misses a call.

Wi-Fi phones, like a Palm Gphone, Cisco's Wireless IP phone 7920, or UTStarcom's F1000, which is currently in beta testing stages for Vonage's VoIP services, look like cell phones and provide all the same features, only they use a wireless Internet connection.

But they may quickly become extinct courtesy of new hybrid phones from Motorola, Hewlett-Packard and NEC that allow a user to connect to a cellular connection when available, and to the Internet when there's no signal.

At roughly $300 to $500 a piece, these hybrids are fairly expensive, and though many of them were announced last year - like the Motorola CN620 Wi-Fi phone - many have yet to appear in stores.

The quality of VoIP phone calls has evolved. However, there are regular reports of crackling, echoes and delays.

"During the implementation, we had to do a degree of tweaking so there was no more feedback - it's an art rather than a science," reported Chris Ashby, president of Pro-Active Solutions, a consulting technology and accounting software firm headquartered in Detroit. "Once we got it right, it's been stable and robust, with significant cost savings."

As for relying solely on a VoIP connection at home, even providers believe in keeping a regular line, just in case. "I'd never recommend not to get VoIP, but there are times where I wouldn't recommend throwing out the baby with the bathwater," said Cornfield. "I have a 14-month-old daughter and I have 911 with my VoIP account now, but I have a Verizon basic service, so no matter what, I have that 911 service and I don't have to worry about the VoIP connection being down. The Internet is not 100 percent reliable."

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