Qwest To Offer VoIP

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Qwest Communications will introduce VoIP service in Minnesota, taking advantage of a Minnesota federal judge's ruling to deregulate Internet telephone service. Qwest's announcement also comes in the same week that the regional telephone provider begins marketing long-distance service in the 12 Western states, including Minnesota, where it already dominates local phone service.

Qwest CEO Richard Notebaert made the VoIP announcement at a technology conference in Washington, but he didn't divulge details on pricing or a timetable for the rollout. Just last month, Judge Michael Davis galvanized the telephone industry when he ruled that VoIP, as a telephone service over the Internet, was a data service and, as such, does not come under the regulatory--and taxation--aegis of the Minnesota Public Service Commission.

The ruling was in direct opposition to the stances taken by several other states, which have declared VoIP a pure telephone service subject to state regulation and taxation. The issue is still the subject of debate in state and federal regulatory agencies.

As for Qwest, it is suddenly in the position of competing with itself, particularly in business accounts. A Qwest spokesman said the VoIP service will have all the appearances to users of "a regular phone service." Qwest indicated that the early presence of independent VoIP providers in Minnesota encouraged it to announce its own Internet-phone service.

The business telephone pie in the western states served by Qwest is a big one--$6 billion a year, according to Cliff Holtz, executive vice president of Qwest's Business Markets Group. The company has a robust fiber-optic network serving the region, but had been hampered from using it because of regulatory tie-ups due to the firm's longtime accounting problems.

Another regional telephone company-BellSouth--last week announced that it, too, would enter the VoIP market.

This story courtesy of TechWeb.

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