The cost of phone calls has been dropping for years, but there's still a lot of room to push prices down to pocket change -- if you're not afraid to make calls through your computer.
A growing number of calling services take advantage of the technology known as voice over Internet protocol, or VOIP. Thanks to continuing technological improvements, the plans are easier to use than ever and can save you a boatload of money on long-distance and, particularly, international calls.
But don't rely on the plans as your only phone service: Most don't provide emergency 911 calling, and there can be other drawbacks as well.
You might not know it, but you're probably already using VOIP: It's the same technology that AT&T Inc. and Verizon Communications Inc. use to handle your long-distance calls, and it's the backbone in the so-called digital-calling plans offered by cable TV giants like Comcast Corp. and Time Warner Cable Inc.
The cost savings of VOIP has allowed upstart phone-based firms, including Vonage Holdings Corp. and Packet8, to compete against the big players, even though they don't own the lines to your home.
VOIP technology breaks up voice into data packets and sends it, like e-mail, over high-speed lines without the need for a lot of expensive hardware that phone companies use.
Scores of computer calling operations -- Skype Ltd., SightSpeed Inc. and Gizmo Project among them -- don't think those entrenched phone companies are passing the true savings of VOIP on to consumers.
And such companies as Mobivox Corp. and ISkoot Inc. believe that's especially true in the higher-priced mobile-phone industry, so they are bringing the same free and low-cost calls to cellphones.
"Costs of calling are dropping to free," said Andy Abramson, an industry and marketing consultant who has tested all the major VOIP operations.
Consumers might pay a basic access charge -- "an admission fee," Abramson called it -- for a connection or a basic calling plan, but they don't have to pay more just to talk to someone around the corner or around the world.
Neal H. Shact, chief executive of telephone services company CommuniTech Inc., recalled a visit to Paris two years ago when he spent $1,000 on cellphone calls.
"Two weeks later, I went to Sweden and used Skype through my laptop for even more calls and I didn't spend the whole $12 I had paid for," he said.
But the VOIP companies are businesses too and have to make a profit to continue offering service.
