Bells are ringing

By Sarah Modlock

14 September 2005

When he's not blagging transatlantic flight upgrades, my brother Michael spends hours every week talking to his girlfriend Erin in New York. But it's not just love, devotion and frequent flyer miles which are essential to keeping their NY-LON relationship on track; it's their friend Skype.

In fact, Skype is the new best friend of 53 million people all over the world. He's not only a communication whizz, he will save you a ton of cash. For the uninitiated, Skype is computer software which allows users to make telephone calls over the internet. It's part of what is predicted to be the next revolution in telecoms and is one of several products offering 'Voice over Internet Protocol' or 'VoIP' calls.

As broadband becomes cheaper, faster and more widely available and almost every home has a computer, VoIP is expected to give traditional telecoms companies a run for their money. The beauty of VoIP is that the software is easy to use and often free, the calls have crystal clear quality and if the person you're speaking to also has the same VoIP software then the call wont cost a penny.

To use VoIP you ideally need a broadband connection although it will work with dial-up. The other small piece of kit worth investing in is a set of headphones with a built-in microphone. On screen, VoIP products usually look like instant messenger and often have the same facilities - you may already have used the Voice facility on Yahoo! Messenger. Importing contacts from your email system is also ridiculously easy. For instance, the Skype wizard scoops up the email addresses and then runs them through the system to see if any are existing Skype users. You need to check the final results carefully though - I was offered a link to a random Alan Griffin in Estonia instead of Alan Griffin at Reuters and it completely missed my mother.

When you want to make a call you click on the contact's name, the system 'rings' at the other end and then you're ready to talk. And talk. Just like messenger, you can set different levels of availability although I'm still waiting for 'Hungover' and 'Getting a manicure' options. In fact you can also use instant messenger in conjunction with most products. Conference calling and voicemail are other useful features which often come free.

Talk is cheap

There are new providers joining the VoIP market all the time and it's worth making sure you know exactly what is free and what is not. Services which provide free calls between users of the same software are financed by the charges the provider makes if you use your computer to call a landline or mobile instead. So chatting to your pals who are hooked up to the same VoIP costs nothing but using it to ring your maiden aunt's UK landline will be charged. Expect to pay between 1p and 3p per minute depending on your software provider and between 9p and 15p per minute for mobiles and international calls although these rates are still much cheaper than traditional landline calls. You can compare costs on most providers by visiting a comparison site such as uSwitch.com.

Some providers charge for their software. You should also look out for a sign-up fee, a monthly rental cost or both. IP Speak for example has an annual £50 charge and Vonage has a flat sign-up fee of £16.99 and monthly cost of £9.99 but you get all local and national calls free and calls to mobiles and international numbers are much cheaper. So an all-inclusive offer could work out to be better value depending on your usage. Don't forget you are also paying for line rental and a fee for your broadband connection so factor that in to your calculations. It's well worth making sure that your broadband package is not too restricted - many providers set limits on the amount of content you can download each month and data for phone calls will contribute towards your limit.

Another difference with Vonage is that you plug a telephone handset into the specially adapted router to make internet calls. This enables you to whisper sweet nothings from your bedroom, your bathtub, just about anywhere other than having to sit in front of your PC. Special handsets are available for use with other services but currently cost around £35.

It's also worth noting that VoIP services do not provide a connection for 999 calls. The exception to this is Vonage but its system does not currently enable the emergency services to trace your location through the number if you cannot continue speaking. So if my Champagne bubbles go down the wrong way or I'm are struck dumb by a bad case of writer's block then I will need a landline or mobile close at hand.

This 999 problem is currently one of the hot issues when considering how quickly VoIP will replace traditional landlines. The other is the none-too-small matter of only being able to receive calls when your computer is online. As ever, the industry is working on improvements to the technology so it should only be a matter of time. Until then you would be well advised to keep hold of you landline in addition to making savings online.