VoIP to change telephony

Cayman consumers are set to get a taste of the future of communications when Cable & Wireless launches its Voice over Internet Protocol service in the coming weeks.

Customers with broadband Internet service will be able to hook their telephones to special Cable & Wireless adapters that plug into a computer, enabling VoIP users to call anywhere in the world at lower costs than standard IDD rates.

The new service, called NetSpeak by C&W, offers low-cost dialling both for long distance and local calls.

In Cayman’s post-liberalisation telecommunications world, where calls to the United States, for example, can cost less than 30 cents per minute, VoIP offers even more savings.

‘Receiving approval from the ICTA (to provide VoIP) could tremendously reduce the costs of telecommunications for the people of the Cayman Islands,’ said Alee Fa’amoe, Cable & Wireless’ VP Broadband Northern Caribbean recently.

The development indicates changing times for Cable & Wireless, which held the island’s telecommunications monopoly until July 2003.

Chief Operating Officer Ian Tibbetts said the decision to launch VoIP is a sign of the company’s new direction.

‘We have surprised a lot of people in the last year,’ he said. ‘We’ve decided to take a leadership approach. Rather than fighting the trends, we’ve embraced them. We see where the market is going and lead the charge.’

The company’s change of approach did not happen overnight, Mr. Tibbetts said.

‘It’s like calculus in school. You bang your head on the wall for three months and then one day it all clicks, and it makes perfect sense after that.’

Critics have faulted Cable & Wireless for not offering VoIP sooner and, in fact, for blocking the service.

Mr. Tibbetts said Cable & Wireless had been required by the terms of its licence to block VoIP in pre-liberalisation days, a move vindicated in a court case filed by US telecommunications company Net2Phone.

More importantly, Mr. Tibbetts said, Cayman has not previously had the regulatory framework to allow VoIP services.

VoIP has made significant inroads in recent years as technology has enabled improved quality of service.

Mr. Tibbetts said Cable & Wireless’ VoIP service would meet top performance standards, one reason the company recommends minimum connection speeds of 256K.

In such countries as Japan, China and South Korea, VoIP already has gained significant market share for voice communications.

In the US, VoIP users jumped from approximately 110,000 at the end of 2003 to just under 1 million by the end of last year.

Estimates are for between 12 million and 20 million VoIP users in the US by 2009.

Mr. Tibbetts said the telephony landscape was changing dramatically.

‘In five years, I think VoIP and the various types of mobile communications will account for the majority of connections,’ he said, predicting competition for the low-cost voice service.

‘I’m sure there will be other VoIP providers in the Cayman Islands in the coming months,’ he said. ‘People are surprised to see Cable & Wireless leading the charge.’

Cable & Wireless declined to release details of VoIP costs before ICTA approval of its application, but said it will charge a basic monthly fee for NetSpeak plus other charges.

Mr. Tibbetts said people making international calls would benefit the most.

Cable & Wireless filed its VoIP application with the ICTA 26 January.

‘We were actually hoping to be able to launch on the first of March,’ said Mr. Tibbetts.

Cable & Wireless has met ICTA officials, but, he said, ‘we have no definite date yet, but I’d like to think we’ll be in a position to launch VoIP in the next couple of weeks.’

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