Routers, phones dialing in VoIP

LAS VEGAS--Major device manufacturers are planning to incorporate Internet phone calling technology into their modems and cordless phones, another sign of the growing popularity of this cheaper version of telephone calling, executives said on the sidelines of the Consumer Electronics Show.

A typical new breed of this device is from Zoom International, a Boston-based electronics maker. The ADSL X5v, shipping in March, is primarily a broadband modem. But it also has a built-in analog telephone adapter (ATA), usually a separate device to convert traditional phone calls into the packets of data that travel over the Internet.

The device, which costs about $100, lets any of five home phones make Internet phone calls, Zoom Vice President Terry Manning said.

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In the next six to nine months, some Motorola cordless phones will also contain an ATA, Motorola senior marketing director Bill Taylor said. "We are in the process of integrating that architecture right now," he said. "While the dates are a little squishy, we think it'll be ready in about nine months."

Chipmaker Texas Instruments has sold reference designs for modems that incorporates an ATA for the past 18 months with little success. The past year of growth of broadband phone subscriptions and the projections for an even faster take-up rate in the next few years has renewed interest in the designs, said Fred Zimmerman, TI's director of broadband phone equipment.

For example, a recent development pact with broadband provider Vonage could lead to the creation of such a hybrid device, he said. TI and Vonage are working together to provide voice over Internet phone equipment compatible with the Vonage telephony network.

"Putting voice into a cable or DSL (digital subscriber line) modem is where things are headed," he said.

The main benefit of this convergence is that what's called voice over Internet Protocol (VoIP) will become much easier for homeowners to set up, something that's considered key to the progress of VoIP dialing.

But adding ATAs will likely increase the price of such phones and modems, one of two main concerns keeping major manufacturers from adding ATAs into all of the devices. For example, the Zoom modem with an ATA inside costs about $20 more than an ordinary modem, Manning said.

Another major concern by manufacturers is the unsettled regulatory environment surrounding VoIP. So far, state regulators have been unsuccessful in their attempts to assess fees and taxes on VoIP providers, something that threatens to drive up the cost of Net telephony dialing plans by as much as 30 percent.

The Federal Communications Commission and state utility regulators are in the process of deciding whether this regulatory-free environment will continue.