VoIP shrinking the world
BUSINESS OF MONTH / GLOBAL VILLAGE POSSIBLE

Since Canadian media guru Marshall McLuhan popularized the phrase "global village", we've been subjected to numerous claims that one innovation or another has, finally, taken us there.
But when Alexandre Sennett links the phrase with voice-over Internet protocol (VoIP), it's hard to disagree.
Mr. Sennett, president and CEO of Bitflow VoIP Inc., makes a strong case for the VoIP as a true telecommunications world-shrinker.
"VoIP technology has made the global village possible," Mr. Sennett said in an interview from Bitflow's head office in Richmond Hill. "When you have a telephone line at home, you have to be at home to use it. With VoIP, no matter where you are in the world, anywhere you have an Internet connection, you can use your phone."
In fact, using the Internet to make telephone calls has become the fastest growing segment of the telecommunications industry in recent years.
While the technology has been in place since the mid-1990s, it has only been in the past few years that barriers to sending voice over the Internet have been overcome.
Although the system is still developing, the growth of broadband Internet service and technology to integrate the Internet with traditional telephones has advanced significantly, Mr. Sennett said.
By 2008, more than 11 million broadband-enabled homes and almost one million businesses in the United States will be using VoIP for telephone calls, according to industry consultant Analysys.com
A study by Wanadoo in the United Kingdom (where VoIP technology is ahead of ours) predicts 10 million Brits will be signed up by the end of this year.
"Every year has its iconic gadgets," said Philip Mehl, Wanadoo's director of sales. "In 1986, it was the car phone and 1996 was the Web. With VoIP, Brits need look no further for the latest technology must-have."
Here in Canada, NRI/Michael Sohn Associates expects there will be 1.1 million households using an Internet telephone service by 2007.
Little wonder Bitflow Software, which was established in 2001, decided to create its own VoIP arm last year and, just before Christmas, signed an agreement with Montreal-based Mediatrix Telecom, a leader in VoIP access equipment, to advance the services both companies can offer.
"We have the software and the network and they have the equipment," said Mr. Sennett, a software engineer. The professionalism of the technical and management teams at Mediatrix was one of the major attractions to partner with them."
With Mediatrix, whose products have received commercial endorsement from some of the world's leading telecommunications manufacturers, Bitflow will be able to offer its customers quality of voice, stability and secure end-to-end connection, Mr. Sennett said.
The big attraction of VoIP, of course, is cost, Bitflow technical partner Tom Taylor said.
"It comes down to long-distance calls," Mr. Taylor said. "For instance, if you've got a kid in college, you could be spending $75 to $100 a month in long-distance charges. Those numbers come down to around $20 with VoIP and the student doesn't need to pay the $25 expense of having a Bell line in his room."
In addition to doing away with a traditional phone line, VoIP allows subscribers to purchase a bundle of services including unlimited long distance to anyone within a defined geographic area.
Features such as caller-ID, call-waiting, voice-mail and call-forwarding, which usually cost extra on traditional telephone systems, are included in the package.
Using the Internet connection for both data traffic and voice calls allows consumers to get rid of one monthly payment.
Does VoIP mean the end for the telephone as we know it?
"I would say that's going to happen in the future," Mr. Sennett said. "Traditional systems will be eliminated. If a consumer can get high-quality, lower-cost telephony over the network, there's no need for a second network coming into the house. The telephone (function) is going to be a software application."
While most current activity is in the commercial area, according to Mr. Taylor, the real growth potential lies in residential business.
"There were some issues holding us back until last year, particularly the question of 911; we had to be able to provide the same level of compliance for 911 calls as the standard phone line," he said. "That was completed in August and allowed us to really begin marketing VoIP."
And not all VoIP services are created equal, according to Mr. Sennett, who cites an example known as SIP (session-initiated protocol), which helps users prioritize network traffic into voice before data.
"VoIP technology is evolving very fast and not all providers are compatible with SIP," he said. "Anyone considering VoIP should question would-be providers about compatibility."
Even if the rollout of VoIP isn't complete, communications columnist Rick Hendershot says its arrival amounts to nothing less than a telecommunications revolution.
"Ever since the birth of the Internet, entrepreneurs with an eye to the future have been predicting telephone services would eventually be merged with the Internet," he said. "With the widespread adoption of VoIP, that day has come and it is causing a revolution in the industry."
Which means we're not making too much of a leap in linking VoIP to the ultimate arrival of Mr. McLuhan's global village.