3Com builds modem for Net telephony

The new modem will allow people to make Internet-based phone calls using a regular telephone. The market for Net-based calls has grown, especially overseas, as fees for Net-based phone calls are often cheaper than traditional long-distance phone calls.

To make a call, previously Net2Phone subscribers had to dial a number over the company?s software on a PC, and speak through a PC microphone. With 3Com?s new modem, users can simply dial direct on their telephone as long as the phone is connected to a PC with the modem installed, 3Com product manager Juan Lopez said.

Net2Phone charges about 3.9 cents per minute for domestic calls. International long-distance rates start at 15 cents. All calls are routed through Net2Phone's private Internet-based network.

With the release of the new modem, 3Com aims to capitalize on the emerging Internet telephony market as voice quality improves and consumers catch on to new Internet-based phone services, such as unified messaging. Unified messaging consolidates voice mail, email, text paging and fax services so users can check messages from a single source, whether over a PC or phone.

Of the 7 trillion total minutes people spend on the phone each year, calls made over the Internet are expected to jump to 4 billion minutes by the end of 2000 from 2.5 billion total minutes in 1999, according to analyst firm Probe Research.

3Com executives say the modem may help spread the use of Net telephony. "The voice-over-Internet market is where the Internet was four or five years ago," 3Com?s Lopez said. "People are starting to play with it, but it's not out there in the masses."

3Com plans to ship the new analog modems, which offer data transfer speeds at 56 kilobits per second (kbps), by April. Pricing has not been set.

For Net2Phone, the deal gives the upstart Internet telephony firm another boost in a nascent but highly competitive market that includes Deltathree.com, Dialpad.com and ZeroPlus.com, among others.

Net2Phone has made numerous deals with other big-name firms, including Panasonic, which is building Net2Phone's Internet phone service into future telephones. The firm also inked a deal with Compaq Computer, which is installing Net2Phone's voice software into its consumer PCs.