RealTime IT News

Yahoo Sounds Voice With AT&T

Yahoo announced that Messenger with Voice, which it made available in a beta version last month, was being rolled out for general availability.

Yahoo would not get into specifics, but said it was happy with the number of users who signed up for the beta version.

"We're really pleased with the response so far," Nicole Leverich, a spokeswoman for Yahoo, told internetnews.com.

Messenger with Voice allows users to call landline or cell phones from their PCs for as little as two cents a minute, and both send and receive calls to their PCs for $2.99 per month. Voicemail is provided free of charge.

Leverich said that the service allows users to integrate all their existing Yahoo mail options, including instant messenger and saved contacts, into a personal communications platform.

"You can go straight from having an IM conversation to calling them on the phone," she said.

However, Leverich said that Yahoo is not attempting to compete with traditional telephony providers.

Messenger with Voice "is not intended to replace their phone lines; it's just an alternative for them to have," she said.

Will Stofega, an analyst with IDC, suggested that Yahoo is using its VoIP offering mainly to attract users at the younger end of Yahoo's demographic spectrum.

"It's another arrow in their quiver as they start asking for more money from their advertisers," he told internetnews.com.

Indeed, far from competing with traditional telcos, Leverich said that Yahoo has reached an agreement to offer Messenger with Voice as a co-branded service with AT&T in areas that company serves.

The agreement allows AT&T to solidify and expand the relationship that existed when it was still known as SBC, while also expanding into geographic regions covered by AT&T prior to its acquisition.

"Yahoo had a tight relationship with SBC," said Stofega. "Whereas, before they made this deal, AT&T had nothing," he said.

Also as part of the agreement, AT&T will become Yahoo's preferred termination provider for calls originating in AT&T's coverage area.

"AT&T's network will provide back-end routing for the call," Leverich confirmed.

For its part, AT&T also announced a new broadband offering to residential customers beginning May 1.

Sarah Baker, a spokesperson for AT&T, told internetnews.com that the service is being offered at "a market-leading price."

The telco already offers two tiers of service -- Express and Pro. The new tier, dubbed Elite, will offer downstream and upstream speeds at least three times faster than Express, albeit at more than twice the price.

The Express service is $12.99 per month and reaches speeds of between 384 Kbps and 1.5 Mbps downstream and from 128 Kbps to 384 Kbps upstream.

The new Elite service will cost $27.99 per month, with upstream speeds of up to 6 Mbps downstream and upstream speeds that top out at 768 Kbps.

The company also requires a 12-month commitment and levies hefty early-cancellation fees.

Stofega intimated that other providers, including Skype and Vonage, are doing a better job at attracting users to VoIP than are the older telcos.

Vonage in particular, he said, is "a potential conqueror of the Bell companies."

A spokesman for Vonage said the company would not comment.

AT&T also announced an agreement with Internet movie delivery service Vongo today, providing its customers with an extra incentive to sign up for their service.

"Vongo's compelling content increases the value proposition for AT&T High Speed Internet customers," Scott Helbing, chief marketing officer for the consumer division of AT&T, said in a statement.

Vongo, unveiled earlier this year, delivers movies and other video content over the Internet for playback on Windows-based PCs, laptops and select portable media devices, as well as on a TV.

The agreement is the first distribution deal for Vongo with a broadband provider.