Angus Kidman looks at the latest trial of internet telephony.

Published in The Bulletin, May 7 2002

Using the internet to make cheaper phone calls is not a new idea. Given two PCs with headsets, microphones and net connections, it's long been possible to make a phone call without incurring time-based charges. However, the unpredictable nature of internet traffic leads to drop-outs and mixed voice quality.

That may change if a new trial is successful. Telstra is signing up customers for a service that allows them to use their PCs to call normal phone lines, using Microsoft's Windows Messenger software, their existing net connection and a pre-paid calling card.

"From a technical point of view, internet telephony is pretty easy," says Stuart Lee, executive director voice and commercial for Telstra Retail. "The problem has been understanding who the user is so we can build a business and billing relationship."

While Telstra may eventually launch a commercial version of the service, the motive for the trial is partly technical. "We wanted to improve our understanding of how to couple Microsoft's Passport system with our authentication and billing software," says Lee. Passport allows individual users to sign in securely to a variety of net services and Microsoft has been actively promoting it.

While PC-to-PC calls don't incur charges, Lee says the same isn't true if you place a call to a mobile phone or overseas number. "We have to pay a per-minute charge to access those networks." As a result, trial calls aren't free. Lee describes the rates as "competitive", but says pricing isn't meant to be the main attraction.

The trial isn't restricted to broadband users or Telstra customers, though calling over a dial-up net connection does result in reduced quality. "You can tell who it is if you use a low-speed network, but there are often artefacts running over the top," says Lee.

One disadvantage of the Telstra trial approach is that users not only have to pay for the calls themselves, but are also paying for bandwidth consumed. Given that much of the initial appeal of net telephony is in reducing costs, and that text-based instant messages sent via Windows Messenger remain free, it will be interesting to see how users react over the four-month testing period.