[access-uk] free phone calls on the net.
- From: "Derek Hornby" <derek.hornby_uk@xxxxxxxxxxxxxxx>
- To: "access-uk" <access-uk@xxxxxxxxxxxxx>
- Date: Fri, 20 Jan 2006 14:45:28 -0000
Hi all,
The following (which may be of interest to some of you) was in The
Times 20 January 2006
TESCO, Britain's biggest retailer, is to shake up Britain's phone
market with a revolutionary service that allows users to make free
calls over the internet.
The supermarket wants to challenge the dominance of BT by encouraging
people to swap their traditional landlines for the net service, which
allows users to make free calls to anywhere in the world. The
product, which works by converting voice into data and sending it
over the internet like an e-mail, will be available off the shelf
from Tesco stores from today. All consumers need is a broadband
internet connection.
Tesco is not the first to offer this kind of service; several market
players, including Skype and Vonage, already have it. BT has also
offered a similar service for a while, but until recently it has been
reluctant to promote it for fear of undermining its traditional
sources of revenue.
Experts said that, compared with rival services, the Tesco tariff was
not fiercely competitive: although calls between users within Britain
and internationally are free, calls to regular landlines are charged
at 2p a minute and calls to mobile networks at 10p a minute. Other
providers charge an upfront fee with an all-inclusive calls package.
The Tesco service, which will initially be available in 350 stores,
also requires a user's PC to be switched on, which some rival
services, including BT's, do not.
However, analysts said that Tesco, with its huge network of stores
and access to millions of customers, was well positioned to take the
niche technology mainstream. Blair Wadman, an analyst at Uswitch, the
call-price comparison service, said: "Though the tariff is not
fiercely competitive with other broadband services, it is competitive
with regular landline services, and this is really all about its
retail presence which gives it the ability to make this service mass-
market."
Andy Dewhurst, head of Tesco's telecommunications arm, said that the
service was more appealing than others on the market because it was
more consumer friendly.
"With our service there is no upfront contract as with some of the
others, and you do not have to go into any internet site to start
downloading the necessary software, as you do with others."
Services such as those offered by Skype, which pioneered the
technology, he said, were appealing only to "one tecchie person
phoning his techie mate in Silicon Valley", and not to regular
consumers. Tesco, he said, could make the service a practical reality
for British households.
A spokesman for Skype challenged that claim: "It doesn't get much
easier than with us. If you can enter a website and click on a link
then you are there."
Internet phone services have also proved beyond doubt the appetite
for such technology: since Skype was launched in April 2003 it has
had break-neck growth.
More than 47 million people now use the service.
Although internet calls are considered old hat in America and Japan,
Britain has lagged behind in taking up the technology because of the
slow growth in "always-on" broadband connections.
However, broadband has taken off and recently overtook dial-up
access. Broadband penetration is at 34 per cent of households and
research from Ofcom, the telecoms watchdog, found that 40 per cent of
broadband users now have voice or chat applications.
Critics of the new technology complain about the quality of the
calls, which can suffer because they travel over the internet rather
than a maintained network. The service is also only as reliable as
the connection -if that goes down then calls cannot be made. With
many services, users have to be seated at their PC, sometimes with
the added inconvenience of wearing a headset.
The basic cost of making calls across the internet is almost nil. The
real cost is in developing software, after which the service exploits
available internet capacity. However, charging is necessary to link
internet calls with the traditional phone network.
Tesco, which entered the telecoms market two years ago, offers a
mobile-phone service that uses the O2 network and fixed-line service
that uses the network of Cable & Wireless.
While the supermarket group has trumpeted its success in the mobile
market, where it has more than a million customers, it refuses to say
how many landline customers it has. Analysts have speculated that the
service has failed to take off, although Tesco denies this.
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