UPDATE: SBC jumps into the residential VoIP pool

SBC Communications will be entering the residential voice-over-IP market early next year after completing tests currently underway in Chicago, Dallas, Los Angeles and its hometown of San Antonio, Texas.

SBC becomes the third regional Bell operating company to enter the space after Qwest launched last year and Verizon launched earlier this year.

The full-scale VoIP service rollout will take place in early 2005. The service will use IP technology and a DSL Internet connection to deliver voice calling and enhanced features, such as a Web-based portal and advanced call-management capabilities.

"The trials are more for determining the best features, pricing and ensuring quality," said an SBC spokeswoman. "When we roll out service in 2005 it will be available throughout the SBC territory and really outside the territory, although we won’t market outside the territory initially."

SBC anticipates that over time, VoIP will become the preferred voice service because of the features and benefits it enables.

The SBC VoIP Web portal will help consumers manage features such as "find me" and enhanced "do not disturb," which gives customers the ability to specify which numbers they will accept calls from. It also will have a click-to-call capability that lets customers call friends and family with the click of a mouse, as well as voice mail, call forwarding, call waiting, caller ID and three-way calling.

"Initially you will see a lot of the features available with VoIP today, but the service will continue to be enhanced as features become available," the spokeswoman said.

Last month, SBC companies announced the acceleration of Project Lightspeed, an initiative to build a fiber optic-based network within two to three years that will use IP technology to deliver digital TV, VoIP and super high- speed broadband services.

"With the features and enhancements you will see with our fiber products, we expect to see more people migrate toward a VoIP offer," the spokeswoman said.

As of the end of SBC’s third quarter in September, the company reported approximately 4.7 million DSL subscribers. The company has roughly 50 million access lines.

A pricing strategy has yet to be determined, but SBC expects to exploit its ability to bundle broadband access and voice services and considers that a competitive differentiation.

In September, SBC won contracts for several large-business VoIP deployments, including a deal for 50,000 Ford employees located in 110 different facilities.

Citing a more favorable regulatory environment created by recent FCC decisions including the rule designating VoIP as an interstate service, which reduces the potential for state-by-state regulations, SBC said it is accelerating its investment to bring new technologies to the market.

"The FCC ruling last week obviously was good news, but the trial has been going on for over a month and the plan has been to introduce a service anyway," the spokeswoman said.

Prior to the field trials, SBC had been testing VoIP in the lab for over one year.