ISPs give voice to the internet

This year may see the beginning of the end for traditional telephone services, as VoIP (voice over internet protocol) solutions become easier to manage and internet-enabled phones, now sold in electronics shops, find their way to the supermarkets.

But serious questions remain over the quality and price of the internet services New Zealanders receive, affecting not only what we do with our leisure time, but how competitive our industries are in the world.

Annette Presley, the finder of telephony company CallPlus and internet service provider Slingshot, says demand is growing for Slingshot's iTalk product, which allows broadband users to either use their computer as a phone or to plug in a separate phone into their ADSL modem.

"Customer VoIP is the way of the future," Presley says.

New Zealander Darren Marinovich, from internet hosting firm Your Global Connection, uses iTalk to keep in touch with friends, family and customers in New Zealand.

When you dial his 09 iTalk number, you may reach him at his office in Phoenix, Arizona, or wherever else he is travelling.

"I run a T1 line here in my home office in the States and the clarity of the call is fantastic. When people hear me call or see my caller ID, they ask where am I, thinking I have just arrived back to Auckland. I chuckle when I tell them I am in Phoenix in 100 degree Fahrenheit weather and sorry to hear it's raining there," Marinovich says.

It is also cheaper for him to use iTalk for toll calls in the US than use his local provider.

Other ISPs are developing VoIP or telephony capability as well. Ihug has long been selling telephony. Wireless broadband provider Woosh is testing the next generation of its modems which allow phone connections. Iconz is preparing a VoIP offering.

Presley says in countries with truly competitive internet sectors, providers fight for customers based on applications rather than price.

"That isn't happening here. Our time is spent still fighting issues or access, and we are not focusing on value-added products," Presley says.

When she is in Australia, Presley can download movies or television programmes across a 10Mbit/s connection. Here, downloading a movie will be prohibitively slow and blow out the data cap for most internet access plans. "You will probably find it costs around $200," Presely says.

While there is a move to broadband, many users are still starting out on dial-up.

Mike Connor from Kiwi Online, which offers $9.95 a month dial-up, says 80 per cent of its customers have never been on the internet before.

"Broadband has to come down to a realistic price, and that won't happen until you open up the [Telecom lines] monopoly," Connor says.