Skype et al keep phone bill at bay

Some technologies arrive on the market and are a major hit from day one: the iPod and text messaging are examples. Other technologies often take years to catch on.

So-called third generation phones are useful because they allow you to make video calls, download music and surf the web at high speed. But people haven't been throwing their old phones away in droves to buy the new variety. Instant messaging only really took off when ICQ, AOL and then Microsoft made it easy for the non-techie masses to message. Now instant messaging is set to eclipse email in popularity, especially among the younger generation.

Voice over internet protocol (VoIP) calling is a technology that has been around for over a decade but is only now beginning to have widespread appeal. There's a theme running through all these technologies - the simpler they are to use, the more likely they are to be used by the masses.

The problem with VoIP is that it's been too complicated to set up and use. That's a shame because the concept is relatively simple. Instead of using telephone lines to connect you and the person you are calling, VoIP involves you connecting to your computer, which sends your voice over the internet as packets of data to arrive at a computer at the other end, where it is converted back into voice. In other words, it does exactly what your telephone line does now. So what's so great about VoIP?

Because your voice travels over the internet rather than along telephone lines set aside for your use, you don't have to pay telecoms operators for renting that circuit while you're on the phone. Instead, you use your own internet connection, which you've already paid for. A VoIP call generally uses about 1MB of data for two minutes of talk time. Unless you're on a very low monthly internet data cap, making numerous VoIP calls to other computers won't cost you any money over and above the cost of your internet connection.

If you have a broadband connection and spend money on toll calls each month, services like Skype, Google Talk and Windows Live Messenger should hold great interest for you. That's because these services are free. The software can be downloaded for free, and it's just a matter of building a list of contacts that also have headsets or VoIP phones so you have someone to call.

All this used to involve a degree of technical knowledge. But while VoIP still relies on the computer, its no longer a computer-centric service. VoIP phones now look like your own home phone, and in many cases your existing phone can even be used to make internet calls.

I've tried all of the VoIP devices mentioned right, bar the Logitech phones, which have yet to be released, and all of them are easy to use and, in general, deliver good calling quality. The big variable with internet calling is call quality. When you pick up your home phone, you're likely to get a good, clear line every time. It's a different story on the internet, where your Skype or Google Talk call competes with other types of web usage for sufficient bandwidth to connect you permanently to someone else.

As web surfers download bigger files, the internet capacity is in greater demand. Call quality is often degraded.

While free internet calling services are taking off, paid-for VoIP services are also on the rise, with cheap calling again the drawcard. Slingshot has a service called iTalk which lets you use a device called a Voice Box to convert your phone for internet calling. You can call other people on iTalk for free and make cheap toll calls.

Another internet provider, Auckland's WorldXChange, will launch a residential VoIP service next month, and Telecom signalled at its earnings briefing this month that it would have a VoIP service on the market for consumers by mid-2007.

According to research firm Point Topic, there were 24 million paid VoIP subscribers globally at the end of last year, up 65 per cent on the year before. Around 300,000 people have signed up locally for the free Skype calling service. Interest is building in VoIP, and as the devices and software become easier to use and people see the value in being able to hold text chats and video conferences while they talk, VoIP will find its way to the mass market.