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VoIP Calls in Chicago

It might have been more a of murmur compared to HDTV's roar, but you could still hear the sound of voice-over-Internet protocol technology on the National Show floor.

Though much of the interest — and certainly the splashy publicity — on the McCormick Place floor was centered around television products, there still were pockets of voice technology providers. But much of the VoIP chatter at this year's National Show centered not on the technology, but on a crop of companies offering ready-made, "heat-and-eat" telephony services that rely on existing cable-modem data channels.

Internet telephone provider Vonage Holdings Corp. made its debut at the show, after a year of steady customer growth primarily fueled by cable-modem connections. The Edison, N.J.-based company offers customers a flat-rate telephone service that uses a broadband Internet connection as the voice link, rather than the separate dedicated voice channel offered by MSO telephony services.

Vonage came to the show armed with its first cable deals, struck with Armstrong Group of Cos. and Advanced Cable Communications.

Vonage will team with Armstrong to offer co-branded voice service to the MSO's 212,000 business and residential customers in parts of Pennsylvania, Ohio, Maryland, West Virginia and Kentucky. A nearly-identical deal was forged with Advanced Cable for a deployment in Coral Springs and Weston, Fla. There, Vonage also will offer its unlimited residential and small business plan there.

Despite being viewed as a competitor to cable telephony services by some, Vonage account executive Daniel Elwell reported healthy interest from cable operators at the show.

Vonage is trying to position itself as a partner to cable operators, rather than as a predator on their broadband data channels. And while interest is stronger among smaller operators, the company is talking to all of the top MSOs.

"A lot of the MSOs were busy with HD and [video-on-demand], and they probably didn't think we would launch now and as quickly as we have," Elwell noted. "And now they are all trying to figure out, 'What is this Vonage, and do we jump on board with them?' "

All-inclusive approach

On the other end of the show floor, rival provider Net2Phone Inc. was adding its voice to the Internet-protocol telephony game. Unlike Vonage, Net2Phone's system banks on PacketCable technology, and only offers service through partner cable operators.

The company, backed by investment from Liberty Media Corp., has a deployment in Puerto Rico and is in several market trials with unnamed U.S. operators.

Although voice service has taken a back seat to video in many cable operations these days, it is nevertheless a solid business that can take advantage of the U.S. regulatory environment for competitive voice services, according to Net2Phone vice president of strategic alliances Gerald Pearce.

"From a competitive standpoint, the cable operators have a huge advantage right now," he said. "Any cable operator with a data plant has an opportunity to become a facilities-based phone company."

Like Vonage, Net2Phone was finding strong interest from smaller operators.

"Our sweet spot, without a doubt, is that tier-two market," Pearce said. "For the larger operators, I think there is still a market, particularly addressing how they are going to offer service in their rural markets."

Elsewhere, IP voice provider Gemini Voice Solutions Inc. said it can now integrate its voice operating system with modem products from Toshiba America Information Systems.