Eight more cities will get access to Net phone service that requires no additional customer gear.
EarthLink said that it would expand its packaged DSL and phone service in D.C. and seven other metropolitan markets in an effort to give consumers an alternative to local phone companies by year’s end. First announced in January, the service is made possible through a partnership with Covad.
The package is called DSL and Home Phone Service. It consists of DSL service with download speeds of up to 8 megabits per second and Internet telephony that enables consumers to use the phones and wiring in their homes.
Where EarthLink’s service differs is at the phone company’s central office. Until the phone call reaches that point, it acts as a POTS, or "plain old telephone service." This means users can place a call using their standard phone line.
After that, the call is routed through equipment from partner Covad. It then traverses the Internet through Covad’s network before it is passed off to EarthLink’s to ensure quality.
The service combination is made possible by equipment that Covad Communications Group is installing in local phone company offices with the financial backing of Atlanta-based EarthLink.
The service is competing in an already crowded market where cable operators, standalone VoIP providers such as Vonage and Skype, and Internet companies such as AOL, Yahoo and Google are all trying to get a piece of the telephony market.
Unlike other Internet telephony services, EarthLink’s Home Phone Service converts the analog voice signal to a digital signal after the call leaves the consumer’s home. This means no special "box" or equipment is needed in the home to run the service.
This change provides key differences. Unlike traditional VoIP, EarthLink’s service operates during a power outage, and the calls are routed over EarthLink and Covad’s managed networks, rather than the public Internet. From there on, the two services are pretty similar, offering E-911 and custom calling features.
Beginning this month, customers in Atlanta, Chicago, Los Angeles, Miami, New York City, Philadelphia, San Diego and Washington, D.C., will be able sign up for Home Phone Service, EarthLink’s voice over Internet Protocol phone service. The company is also expanding the footprint for the service in Seattle, Dallas and San Francisco and San Jose. EarthLink began offering this Internet telephony services in these cities in January.
EarthLink says service areas in new and existing cities will continue to grow throughout the rest of this year.
Because the service is IP-based, customers will be able to take advantage of several enhanced features they would not otherwise get with traditional phone services, such as call prioritization, click-to-dial, number blocking and Web-based voice mail.
The service is sold along with EarthLink’s DSL service, which provides up to 8Mbps of bandwidth for downloads. Pricing for EarthLink DSL and Home Phone Service starts at: $49.95 per month. The company is using Covad’s DSL infrastructure to deliver the service.
"Consumers receive all the cost-savings and special telephone features of an Internet-based voice service without installing any special equipment or hardware — in addition to the super-fast speed of next-generation broadband technology," says Steve Howe, EarthLink’s vice president of voice, in a statement.
$50 million in funding has been provided to finance a build out of the network to Atlanta, Chicago, Los Angeles, Miami, New York City, Philadelphia, San Diego, and Washington, D.C. Covad has agreed to repay EarthLink for its investment through “$10 million stock and $40 million in convertible debt, due in 2011.”
San Jose, Calif.-based Covad will use the equipment to upgrade the phone and Internet service it offers businesses and resellers.
“With our Internet voice initiatives, we are reshaping our position in the marketplace and redefining what it means to be an ISP,” said Garry Betty, EarthLink’s president and CEO.