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Sony: The 'V' in VoIP also stands for video

Sony introduces Instant Video Everywhere, an Internet video-phone service initially aimed at business customers.

Gadgets kingpin Sony entered the $1 billion-a-year Internet video telephone market Wednesday with a new service aimed, for now, mainly at businesses.

Called Instant Video Everywhere, or IVE, the service initially will be offered to businesses in a premium version with broadcast-quality video. The service will cost $500 a month. Next week Sony will debut a mobile version, which can be used at any broadband connection, that costs $35 a month with a one-year service contract, $45 a month without a contract.

IVE is a product of Sony's partnership with Glowpoint, a Hillside, N.J.-based video-phone service provider known for its "All You Can See" unlimited video dialing plans and easy-to-use, cutting-edge services such as live video operators and video-call mailboxes.

Sony plans to first steer IVE mainly toward businesses, which buy virtually all of the Internet video-calling gear and software on the market. Sony also is contemplating a consumer version of IVE for its popular lineup of home entertainment and gaming consoles, Sony Vice President Eric Murphy said.

"Pushing videoconferencing out of the conference room," as Murphy puts it, will be a tough go not just for Sony but also for Cisco Systems, video phone operator Packet8 and other proponents now trying to do the same.

For the most part, consumers haven't bothered with Internet video telephony. Historically, only businesses could afford video telephony equipment, which also tended to be difficult to use. But even that market has been less than robust. In 2004, revenue from sales of video-calling gear was a disappointing $40 million, although that is 23 percent higher than sales in 2003, according to analysis company Point Topic.

But years of product development have made such services much easier to use and also have pushed prices of videophones below $100. Videophone proponents say the market for their products exists because millions of people are now making phone calls over their Internet connections using voice over Internet Protocol, or VoIP, the same technology underpinning videophone services.

"We're seeing a real trend where people take what are normally business tools home with them for 'non-business' means," Murphy said. "We'll see whether it can transition to consumers."