What's the impact of residential VoIP?

Assessing VoIP’s importance in the greater scheme of things

VoIP, unified messaging, products and services

In the last newsletter, we discussed the recent FCC ruling that essentially frees residential VoIP services from the morass of different state telecommunications regulations. Now that the direction is clear, it’s time to start thinking about whether this matters.

Frankly, we’re not convinced that residential VoIP services will be the biggest thing since sliced bread. On the surface, the concept is fantastic. And, admittedly, as “technology columnists,” the implicit assumption is that all new technology is inherently good.

But residential VoIP has some hurdles to jump over, and state regulation is a relatively small part of the story. Some of these hurdles include:

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In the last newsletter, we discussed the recent FCC ruling that essentially frees residential VoIP services from the morass of different state telecommunications regulations. Now that the direction is clear, it’s time to start thinking about whether this matters.

Frankly, we’re not convinced that residential VoIP services will be the biggest thing since sliced bread. On the surface, the concept is fantastic. And, admittedly, as “technology columnists,” the implicit assumption is that all new technology is inherently good.

But residential VoIP has some hurdles to jump over, and state regulation is a relatively small part of the story. Some of these hurdles include:

E-911: The recent FCC ruling said that these services were not subject to the myriad state requirements. But this doesn’t change the fact that fundamental problems with E-911 for mobile devices still exist. And when you’re making that E-911 call, it’s not a time that you’re likely to think about which line to pick up. Caveat: E-911 capabilities vary significantly from provider to provider.

Pricing: Residential VoIP service is almost free. But so is traditional voice service. Ten years ago, we would go to great lengths for making long-distance calls at a very low price per minute. But calling cards, cell phones, and fixed-rate plans from traditional carriers are competing for those same dollars. We’re not convinced that the majority of consumers are ready to sit at the computer - or at a phone attached to the cable router - simply to save a penny per minute or less. And these current service pricing advantages may be short-lived depending on the FCC’s decisions on issues like universal service fees.

Ringer equivalence: Technology that’s old but still applicable. A hidden fact that we found several years ago when testing ISDN terminal adapters was that most adapters would generate enough ringing current for two or three phones. Admittedly, most of us don’t “need” more than two or three phones. But it’s now expected that most people have a phone in the kitchen, the family room, every bedroom, and maybe the bathroom. So it’s not a given that every adapter will provide the exact same technical characteristics as POTS.

Service reliability: As techies, we’re very tempted to convert to these services as a primary service. But for now Steve still has both cable and DSL Internet access so he can switch from one to the other whenever there’s a service failure. As a second line for outbound calls only, the service is probably sufficiently reliable. But as a single line for the household, we’re not convinced it’s ready for prime time.

So what do you think? Our assumption is that the readers of this newsletter, while oriented toward enterprise-class telecommunications, are among the most technically savvy users in the world. Are you using these services? Even more importantly, are you recommending them to your friends?

Lets us know, and we’ll summarize the feedback we receive.

Read more about voip & convergence in Network World's VoIP & Convergence section.

Steve Taylor is president of Distributed Networking Associates and publisher/editor-in-chief of Webtorials. Larry Hettick is a principal analyst at Current Analysis.