Word To The Wise: Choose VoIP Providers With Care

Most businesses are just now considering how and when to move to voice-over-IP services. But business-technology mangers should be cautious--many of the hundreds of VoIP service providers aren't expected to survive a forthcoming shakeout.

VoIPAction, which runs an informational Web site and has just published the "VoIP North America Directory," lists more than 400 VoIP service providers and more than 450 providers of networking gear. The Federal Communications Commission's decision that VoIP services will fall under federal regulation "clearly opens up the marketplace to even more competition," Chris Lewis, founder of VoIPAction, said in a statement.

In an InformationWeek Research survey of 300 business-technology managers conducted in February, more than 80% said their companies are using (29%), testing (18%), or planning to deploy (34%) VoIP technology. That level of interest in a relatively new technology has attracted a flood of vendors. Not all will survive, says William Stofega, a senior analyst at IDC. "It's difficult to compete against the large carriers that have network assets and a lot of technical expertise," he says. He cautions against jumping for the cheapest price for service. "When people tell you that you only have to pay pennies for telecom services, it just ain't so."