CAIS Internet teams up with Networks Telephony Corporation to begin offering its users Internet telephone service.
It is the latest initiative in the Net telephony market, which has yet to take off. Financial terms of the deal were not disclosed.
"[This] new technology marries the PC, data, and voice networks," said Evans Anderson, vice president and general manager of CAIS Internet.
To make a call, CAIS subscribers use their PC while online. CAIS switches the call from the Internet to the NTC network and makes the connection to the local telephone company. "This bypasses the need for using a long distance company," the ISP pointed out.
Long distance carriers worry that the competition will cut into their business. They also complain that ISPs get an unfair advantage because they don't have to pay network access fees to provide the service. This has sparked a heated debate in Washington about whether to regulate the service. For now, the White House is taking a hands-off approach. (See related story)
Despite its slow start, poor audio quality, and the lack of full-duplex capabilities--where more than one caller can be heard at once--Net telephony has the potential to become a $63 billion market by 2002, according to a recent study by Killen & Associates.