Wireless could provide VoIP push

VoIP is going Wi-Fi, extending its reach beyond traditional phone services and potentially putting an arrow in the heart of telcos.

In December, Vonage announced its combo VoIP Wi-Fi phone, providing access to hot-spots. Given the trend to turn entire cities into Wi-Fi hotzones, such as the recent announcement that Toronto Hydro Telecom will be blanketing the city, VoIP has the potential to cut into the carriers’ lucrative cellular business.

Telcos have another reason to be worried. The desktop has moved to the palmtop, and Microsoft wants to own it. Office 2007, through its Office Communicator application, will be bringing VoIP, video, instant messaging and collaboration to mobile devices.

Wi-Fi, obviously, will be a major part of this delivery model. As a result, VoIP Wi-Fi will bridge to and from providers, using either IP-based networks or wireless phone networks.

Nonetheless, latency is still a big issue with VoIP over Wi-Fi. At the VON conference in Mexico City recently, Brent Hickman, channel manager for Tranzeo Wireless Technologies of Pitt Meadows, B.C., remarked that “you have to have a way of insuring that the data for the VoIP traffic takes priority over other data that is going over the network.”

But at 3GSM in Barcelona, Microsoft CEO Steve Ballmer seemed comfortable with putting as much data over the airwaves as possible, saying that “the wireless industry needs to provide end-to-end services.” Carriers can do it, at least for voice, but they like their margins. VoIP Wi-Fi might just cut out a big chunk of their pie, especially if a mobile device has the ability to automatically switch over to VoIP Wi-Fi when in range.

As with all things Microsoft, you’ll have to spend money to save it, with customers having to shell out not only for Office but also for back-end hardware such as Live Communications Server. This essentially cuts out the consumer market, meaning that VoIP Wi-Fi will continue, first and foremost, to offer “free” but limited enablement of voice and video transfer over wireless networks.

If you want VoIP Wi-Fi to run off your business applications, or if you want to participate in a conference with your sales team, there’ll likely be an independent software vendor collecting money for the privilege. Either that or you can knock yourself out putting it together on Linux.

That’s the way it will have to be for now. In fact, the hidden story in the VoIP universe is the relatively low adoption rates in the consumer space. It is growing, yes, but interest has been limited due to basic satisfaction with wireline voice and the downward trend in long-distance pricing.

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