Microsoft: Your Next Phone Company?

It's keeping mum, but the giant has already introduced software that could turn into the killer phone application

On Feb. 12, the Federal Communications Commission ruled that a voice communication between two people using PCs is more like an e-mail than a phone call. This decision on a petition brought by Jeff Pulver, the entrepreneur behind the Free World Dialup Internet phone service, meant that the hundreds of thousands of people who now use broadband connections for voice conversations can continue to do so unmolested by the tariffs that are levied on traditional phone calls to support 911 service and universal access to the phone network.

While Pulver was jubilant, and the operators of a handful of increasingly popular PC telephony services such as Skype sighed with relief, most of the technology and telecom world yawned. Phone calls between PCs remain rare in the grand scope of the telecom universe. Few businesses use these systems, which remain far less developed than cutting-edge corporate-communications systems sold by the likes of Avaya and Cisco . Those employ Internet protocol to route calls over data connections, but they rarely use the PC as an origination or termination point. Replace Pulver, whose system now has 175,000 users, with Microsoft, however, and the FCC ruling could have enormous significance. The software king has for years made noises about augmenting the voice-communication capabilities in its operating system to allow any two Windows PCs to create a voice link over the Net.

News source: BusinessWeek Online