AT&T responds to VoIP demand

Continuing our discussion on how voice over IP has come of age, today we’d like to highlight the announcement AT&T made last month as it unveiled a “major voice over Internet initiative.”

While AT&T has already offered VoIP services since 1997, the announcement marks an increased focus on features and sales – including an expansion of VoIP services into the consumer market.

Noting a fourfold increase in the business demand for VoIP in 2003, ATT is expanding its VoIP portfolio and will aggressively market a full suite of VoIP-based services to businesses. AT&T will also add infrastructure to reach the top 100 consumer market areas in the first quarter of this year.

AT&T Chairman and CEO David Dorman said, “We will be deploying the best VoIP technology on the nation’s largest IP network, but we will be doing it with the most trusted and proven name in voice services. VoIP is the most significant, fundamental new technology shift in telecommunications in decades and will deliver tremendous value to all customers by leveraging the efficiencies and advanced communications capabilities of IP-based technology.”

We think this move makes sense for AT&T on several fronts. First, since more consumers are bringing broadband connections into their home, AT&T is provided with “ready access” to VoIP services. The same broadband connection can also be used for IP-VPN connections to the home so telecommuters can remain connected to their employers’ VoIP and data services.

Furthermore, as more consumers move to companies like AT&T and MCI for both local and long distance services, VoIP affords an economical platform for additional features and services – providing the consumer with added services and the service provider with the chance to increase revenues.

But the mega-trend angle to this story is that Ma Bell has now wholeheartedly endorsed VoIP as a credible way to offer voice services. The “Baby Bells” like SBC, Verizon, Bell South, and Qwest surely have taken notice of “Ma Bell’s” endorsement. All Baby Bells offer VoIP for the enterprise customer; Qwest and Verizon are also aggressively marketing VoIP to consumers.