Aside from AT&T's Connect 'N Save calling card VoIP service, perhaps the biggest VoIP focus for AT&T right now is its Global Clearinghouse service for PTTs, ISPs and competitive local exchange carriers. Global Clearinghouse is just what you'd expect it to be--a market for IP service providers to exchange traffic and interconnect with others to expand the scope of their VoIP networks. About 25 service providers, including Poptel in Germany and TimeNet in Denver, have joined this service.

"We do the management, settlements and make sure the exchange of traffic occurs," Kwock says. "The service providers pay a transaction fee and AT&T gets a piece of the rates."

Not everyone believes the carriers are truly serious about VoIP just yet. "When IP telephony worldwide is about $36 million in revenue and traditional telephony is $92 billion, [VoIP] is just not on their radar screens yet," says Bennet Bayer, director of product marketing and multimedia services for Infonet, El Segundo, Calif. "When it makes a serious impact on their business, they could then drop prices" for business PSTN.

Incumbent local exchange carriers, such as US West and Bell Atlantic, also are working on VoIP services for businesses. But any long-distance calling services for now would be restricted to their own calling territories by FCC regulations until the regional Bells can prove they have local competition. Still, US West will add two services in the second quarter. Push to Talk Web is a click-and-talk service, while Team Browse will let customer service reps "push" Web pages to customers buying from their Web sites, so that the online buyer can see pictures of a sweater he or she is considering, for example.

US West also is planning a service within its LATAs (local access and transport areas) for calling over IP via a PC, PBX-to-PBX integration over IP, IP desktop video and, if it gets the green light, IP long distance. "When and if the LATA boundaries allow us, we would be able to turn on this capability immediately for IP voice over our network and then reach agreements with other networks to do the same," says Jim Taylor, director of IP services for US West !nterprise, Denver. He adds that US West !nterprise will design latency-reducing techniques into its IP network services.

Bell Atlantic will offer IP voice services within its own LATAs sometime in the third or fourth quarter, says Kamran Sistanizadeh, chief technology officer for Bell Atlantic global networks, who adds that the timing just isn't right yet. "It's going to be nine to 12 months before you can claim voice-over-IP is a business product." Sistanizadeh says Bell Atlantic will offer a PBX interconnection service over its IP-ATM backbone, as well as a video service sometime later.

ISP Action
While the long-distance carriers weigh their interests and LECs their regulatory baggage, the door has been left wide open for aggressive independent service providers such as ISPs. For now, they are free from paying access charges to the local loop, but that's expected to be a short-lived advantage. "It's reasonable to assume that access fees for VoIP services will become mandatory sooner rather than later--US West, Bell Atlantic and Southwestern Bell have provided for tariffing and will tax a VoIP call the same as any other call," says Infonet's Bayer. "We will see them and others tax all voice and data, charging by the packet, in about two years."

PSINet is the first ISP to roll out a VoIP service for business. Its PSIVoice, a PBX-to-PBX interconnection service that basically piggybacks off PSINet's private international backbone, requires PSINet's IntraNet service. PSINet can guarantee the quality of the voice call because it's within its own network.

"We see voice as just another IP app," says Charlie Cary, vice president of product management for PSINet in Herndon, Va. "When you've got a data network designed to handle an IP packet, it doesn't matter what's in it." PSINet compresses the voice call, and provides the necessary VoIP gateways for packetizing the voice traffic as part of the service--the customer provides its own interface cards for the PBXes.