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Will A Price War Run VoIP Out of Business?
ElCheapo writes "News.com looks at the recent price war that has erupted amongst VoIP providers. How much lower can costs for unlimited long distance go before next-generation phone services run themselves out of business? How does this compare with free services that don't offer connectivity to the PSTN?
Packet8 offers service for $19.99/month, a level analysts say is unsustainable. Vonage recently dropped their rates to $35/month to match VoicePulse.
VoicePulse is known to use a softswitch based on the Asterisk open source PBX. Will open source allow startups to compete with the traditional LECs?"
An article like this betrays a fundamental lack of understanding of capitalism. They wont run out of business.
Prices will drop until companies start failing. (If in fact the low prices are unsustainable) So long as there are customers willing to pay for VoIP, there will always be business.
If the price is too high, then they'll be out of business. If the prices are low, they can make it up on volume.
2.9 cents per minute? Feh! I can call any regular phone number in the US for 1 cent per minute..
The kicker? That's one EUROcent.. And I'm calling from The Netherlands. Using our equivalent of a 1010 LD operator (a 4.5ct fee per call put through, no monthly fees except what I already pay my ILEC).
Yes, prices can go down. If international calls can be terminated for less than 0.01 USD per minute, so can domestic ones.
SCO employee? Check out the bounty
Hear hear.
I had a fairly serious problem with this a week or so ago (rowdy teens fighting and throwing each other on my car, no damage, but I didn't want to get in a brawl in my bathrobe...), the 911 person was confused, even though I had registered my # with Vonage's 911 system.
In the meantime, I may just plug my spare phone into my landline and use it for 911 only.
(OH, and for NYC vonage folks, you can contact the city via 212-NEW-YORK, since 311 doesn't work.)