California to Baltimore just became a local phone call.
Strange as that may sound, it's part of an offering by a new company that specializes in Internet-based telephone service - the latest technology promising to make phone service even more unrecognizable than several years ago.
Vonage DigitalVoice of Edison, N.J., is one of the first companies to offer exclusive voice-over Internet service in Maryland. Vonage has signed up about 5,000 customers across the country since March.
The brief history of Internet-based telephone is littered with fallen telecom start-ups, but the technology has improved and Vonage's offerings are unlike anything most phone customers are used to.
"Vonage is the first pure play I'm aware of in the U.S." in Internet phone service, said Stefan Stanislawski of Analysys, a British telecommunications research firm.
Vonage markets unlimited nationwide phone service for about $40 a month, including all local and long-distance calls. It also has a 500-minute long-distance plan with unlimited local calls for about $26 a month. International rates include London for 5 cents a minute and Sydney, Australia, for 6 cents a minute - very competitive according to a check of global calling rates over the Internet. One caveat: You must subscribe to broadband Internet service to have connection speeds fast enough to accommodate the service.
The company's most unusual option is that customers can choose any area code in 30 major markets that the company serves. You can live in the Baltimore-Washington region and have an area code in New York, Los Angeles or Dallas.
The implications are strange: Your next-door neighbor might have to make a long-distance toll call to reach you, but your relatives across the country could call you locally as if you lived near them. You can also take your phone equipment with you if you travel, even overseas, plug it into a broadband connection and have people call you locally as if you had never left home.
Whether or not a Vonage customer chooses an exotic area code, the Internet is able to wipe out the customary bounds of phone service as it has in other areas of commerce and life. There are no differences for local or long-distance calls - even for international calls if the receiver is also on an Internet-based phone.
"When you go on the Web, do you care where that Web site is or how long you stay at the Web site? No. The Internet is all about no time metering, no distance metering. Once you have access, you're in," said Daniel Berninger, managing director for Pulver.com, a telecommunications company in Melville, N.Y. Pulver co-founded Vonage with Jeffrey Citron, who formerly led Datek Online Holdings, a company that made a splash during the 1990s boom of stock day-trading over the Internet.
Phone service via the Internet isn't new. Early Web surfers discovered ways to make calls over the network, sometimes illegally. Telecommunications carriers several years ago began offering voice-over-Internet service in Asia, Africa and the Middle East. Just last month, Italy's national telecommunications company, Telecom Italia, began using the Internet to transport all calls between Rome and Milan.
Telecommunications analyst Insight Research Corp. of Boonton, N.J., estimates that Internet voice traffic will produce revenue of $7.3 billion this year - less than 3 percent of the $257.2 billion spent on phone calls in North America. By 2007, Internet-based service may rise to $85.5 billion - 27 percent of the overall North American phone market of $320.2 billion, it predicts.
For a long time, the technology was hardly taken seriously. Critics said it would never be as reliable as the century-old phone system. After all, when did your telephone last crash?
Audio quality was also an issue. The technology known as Voice-over Internet Protocol, or Voice-over-IP, uses a system called "packet switching." Chunks of a conversation move in packets, or pieces, that reassemble in the proper sequence before they reach the recipient. The process occurs so quickly that the listener isn't supposed to detect any garble from the pieces traveling separately and reassembling. Data also moves that way across the Internet, but voice is more instantaneous and more complicated.
In a traditional "circuit-switched" phone call, the conversation moves in order from start to finish while the circuit is open.
One attraction of voice-over IP is that the Internet and telephone work more in concert: Vonage customers can check voice mail or their call history, incoming and outgoing, on a Web "dashboard." However, customers don't need a computer to use the service, just a high-speed broadband connection. The company said its system works with both digital subscriber line (DSL) and cable modem service commonly available in the Baltimore area, including Verizon DSL and Comcast.