$0.08 Untimed Local And National Phone Calls

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VoIP arrived in the Australian market this week with the launch of the Comindico VoIP service, which has slashed call costs local and national call costs slashed to eight cents and injected some serious competition into the $9.6 billion business call market

Comindico announced the roll-out of eCall for business through which telephone calls can be made over a company's business grade Internet connection using their existing telephone equipment. Eight cent flat rate untimed local and national calls are available from eCall for companies that use this service.

Local calls for companies using the Comindico network to companies on other telephone networks are also charged a flat rate untimed cost of eight cents. National long distance calls to companies via other networks are charged at six cents per minute.

Announcing the arrival of eCall in Australia, Comindico Chief Executive Officer, John Stuckey, said that eCall would have a profound impact on the telecommunications industry in Australia and further reduce costs to businesses across the nation.

'Comindico's modelling suggests that companies can save up to 60 per cent by moving from yesterday's telephone systems to eCall and utilising our network built specifically for eCall,' Mr Stuckey said.

'The days of national call rates are over. Any company in Australia with business grade internet access can make eCalls.

'In addition to the obvious savings to be made in call costs, businesses will find substantial savings elsewhere, in terms of getting a better return on investment from their IT infrastructure and lower network access costs.

'With telephone line charges increasing and Internet access costs decreasing, Comindico's eCall will enable companies to significantly reduce the number of lines they need while maximising the spare capacity of their external Internet connection.

'Comindico's eCall does not require companies to scrap their existing systems to take advantage of the lower costs and better technology. Companies with IP capable or IP convertible systems can switch over immediately.

'While email has changed the way businesses operate, eCall is the first step in revolutionising the way businesses are connected. However, you can't be a part of the revolution using old style telephone networks. Only networks like Comindico's are capable of sending and receiving voice calls down the same pipe as an internet connection.'

eCall's utilises VoIP (Voice Over Internet Protocol) technology, delivered over Comindico's $400m IP network, regarded as one of the largest of its type in the world.

According to the latest figures, 20 per cent of the world's international telephone traffic is currently carried over the Internet. Within ten years a hundred per cent of all voice traffic is expected to be carried over the Internet utilising similar technology that allows Comindico to announce and deliver eCall.

Similar systems are gaining widespread adoption in the United States, UK, Canada, China, Italy, and Japan.

eCall initially will be available to businesses in Australia before a residential service is offered by mid 2004.

'Comindico's $400 million network is purpose built to offer every technology solution through one pipe. It is the largest computer and telephone network of its kind in the country with 66 network hubs spanning the nation. Currently the network carries over one billion minutes of Internet traffic and voice every month. The Comindico eCall network is powered by Cisco systems,' Mr Stuckey said.

Paul Budde, Telecommunications analyst, said:

'VoIP creates an opportunity to get some action back in the voice market and to provide a massive disruption to the traditional call carriers. Comindico has the network and the capability to lead the VoIP charge to the industry.'


' In December 2003, AT&T, SBC and Qwest each announced aggressive

rollouts of Voice over Internet Protocol (VoIP) services to their customers.

Verizon, the US's largest telephone company, announced that it was

finalising the conversion of its traditional circuit switch network into one

that handles VoIP.

' British-based BT recently announced the launch of its VoIP service.

Customers can make unlimited phone calls in the UK via their Internet

connection for a fixed monthly fee. BT is treating this as a value-add to its

Internet service.

' Japanese telecommunications regulators have endorsed mass migration

to Internet-based telephony. Its new three digit telephone exchange

allows the old telephone service a seamless transition to VoIP.

' Bell Canada announced in December 2003 that it will migrate 100% of its

traffic, including all of its voice traffic, onto a national Internet Protocol

backbone network within three years.

' Cable provider, Time Warner (11 million subscribers), announced that it

has started providing Internet-phone based services to its subscribers.

Other cable players Comcast, CableVision Systems and Cox

Communications are including VoIP in their bundle of services.

' Initial estimates are that the cable companies could gain 5%-20% of the

US$200 billion US/North American phone services market within 10 years.

' IBM announced at the end of 2003 that it will move 80% of its 300,000

employees to VoIP phone systems by 2008.

' The Nasdaq estimates that it has cut US$40million off its US$100million

annual network cost by using VoIP to consolidate its 15 networks into one.

' Since its launch three years ago, Vonage, a US-based private company

leader in VoIP for consumers, has reached 85,000 customers paying

US$15-$35 a month and continues to attract 10,000 new customers each

' One of the highlights of Cisco Systems' recent quarterly earnings came

from the soaring sales of IP telephones using VoIP. It says that it sold

over 400,000 IP phones in the third quarter of 2003.

' Lighthouse, a US-based online agency which tracks the communications

network business, reports that the market for all VoIP equipment,

estimated at approximately US$1bn in 2002, is likely to reach almost

US$4.3bn 2006.

VoIP in general

' Since the inception of IP voice telephony over the internet five years ago,

IP networks carry 20% of the world's international voice traffic.

' Deloitte's research 'Wire-line predictions 2004 report' released in January

2004 in the US, predicts increased broadband adoption, new broadband

appliances, and rising VoIP subscribers. The report says: 'The business

market will begin to migrate to VoIP, compelling operators to prepare for

the transformation of the telecommunications industry.'

' Worldwide spending on Internet telephone systems by businesses is

expected to exceed $1billion this year, more than double last year.

' The viability of traditional telecoms companies is being questioned. UBS

Warburg telecoms analysts estimate that local voice and related services

generate 60%-65% of the US-based Bell company revenue and at least

75% of their profits. UBS warns that as VoIP becomes more pervasive, it

will be extremely difficult for the carriers to replace these profits. (BW

Online 9/8/03 'Time to rewrite the rules of Telecom'.)

' Some US-based research estimates show that nearly 30% of US

businesses may move to VoIP within two years and that by 2009 the net

could be carrying 40% of all calls made in the US.

' In November 2003, the US Federal Communications Commission

announced a yearlong enquiry into the appropriate regulatory environment

for VoIP services.

VoIP in Australia

' In Australia, IDC predicts that IP telephony hardware revenue is set to hit

AU$679 million by 2006, mimicking the world trend.

' Citigroup Smith Barney in a telecommunications report dated January 2nd

2004, for Australia and New Zealand, said that '-delivering voice service

over IP will eventually be the standard basis for operators to transport

voice traffic throughout their networks and that the current generation of

networks will evolve, and simplify, gradually over the next 10-12 years to

all IP next generation networks.'

Benefits of using VoIP

' It is cheaper

' You can redirect calls to other numbers

' You can programme the phone to take messages only during certain hours

and to give messages only to certain callers

' You can programme it to send a text message or an email in response to a

voice call

' You can make a call from your Outlook address book

' Unified messaging will mean that you can retrieve voicemail the normal

way or by listening to an audio file in your email or stored on the web in a

password-protected area

' Sophisticated call forwarding will send a call to numerous numbers

simultaneously in order to locate the person with whom you wish to speak

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