By Darren Waters
Technology editor, BBC News website, Norwich
Internet telephony is changing the way people communicate. But is the technology ready for the mass market yet?
Net telephony is shaking up the telecoms world
Already more than 500,000 Britons are active users of net telephony or, to use its proper name, voice over internet protocol (Voip) technology says regulator Ofcom.
People with broadband at home or work are using internet telephone services such as Skype, Vonage and the voice capabilities of programs such as MSN Messenger, Yahoo Messenger and iChat.
Some analysts forecast there will be about three million PC-to-PC Voip users and about one million who use Voip services to call to and from traditional telephone connections in the UK by the end of 2007.
While Voip is proving very popular with PC users many believe the technology will take off in the mass market once consumers start using portable devices with wi-fi built-in such as hybrid mobile phones, PDAs, and dedicated wi-fi phones.
Technology firm Belkin is releasing a wi-fi phone in the UK later this year; it has Skype software built-in and enables people to call other Skype users around the world free of charge and to mobile phones and landlines at a much reduced cost.
Rob Falconer, sales and marketing director for Belkin, said: "Voip has taken off in the corporate world. Skype is part of our telephone solutions at Belkin.
"The end user has no idea about "Voip", but quite a few will have heard that you can make cheap calls via the internet."
Voip can be a powerful tool: the Technology section of the BBC News website spent a day using internet telephony in Norwich, where the city is blanketed in a free, wi-fi network.
We were able to make phone calls using Skype to UK landlines with little or no problems. The voice quality was good and the connection was reliable.
But the rapid growth in Voip services is raising issues. UK regulator Ofcom has released proposals that would require internet telephony services to make clear to consumers the technology's limitations and capabilities.
"Internet telephone services would be required to provide specific consumer information," an Ofcom spokesman told the BBC News website.
He added: "Voip is a young and growing market with a lot of potential and exciting benefits for consumers.
Not all net phone networks are useful in emergencies
"More and more people are using Voip since they have broadband in their homes."
Ofcom is concerned that the rapid growth in net telephony and the variety of services offered could potentially confuse consumers
"Not all Voip providers offer the same level of service," the spokesman said.
He added: "We are proposing that providers tell consumers at point of sale and when they use the service about its capabilities.
"We believe consumers should have all the information possible when they are buying into a service."
At present Ofcom recommends that consumers ask questions of their Voip provider before spending money or using it.
They include asking if the services offer access to the emergency services or even if they will work during a power cut.
Ofcom says it has taken no final decision on how it will treat Voip but mandatory consumer warnings have not been ruled out.