EarthLink took a major step forward in its evolution as an Internet Service Provider on Thursday, announcing the addition of telephony voice services over its high-speed connections.
With the move, EarthLink (Nasdaq: ELNK) claimed it became “the first major ISP to offer its customers a comprehensive and easy to use Voice-over-Internet Protocol solution,” said Erika Jolly, the company’s vice president of strategic brand management.”
Working in conjunction with Vonage, which is providing the digital telephony equipment, EarthLink is offering unlimited local, regional and long distance calling for a flat rate. Other services include voicemail, caller ID, call waiting, call return and call forwarding.
Prices start at $39.99 a month, and the necessary equipment is provided free of charge.
Targets of the offering are EarthLink’s high-speed cable and DSL customers. The company reported having 779,000 high-speed users at the end of 2002, an increase of 65 percent over 2001 figures.
Its dial-up customer base, on the other hand, fell by 4 percent, to just over 4 million.
Analysts saw the move as evolutionary rather than revolutionary, reflecting a growing demand for VoIP services as well as the needs of ISPs to generate additional revenue.
“It’s just a natural evolution of the market,” Timothy K. Horan, an analyst at CIBC, told Dow Jones News Service. “Voice is just becoming another application for a broadband. Like e-mailing or messaging, you’re just adding one more product on to it.”
In announcing the offering, EarthLink said its broadband customers could install the service in a few moments. Hardware includes an analog telephone adapter box which coverts digital to analog.
The package also offers reduced rates for international calls: 5 cents per minute to call Great Britain; 7 cents a minute to call Japan; and 6 cents a minute to call Mexico.