The Yahoo offering, to be available in 180 countries, will link with existing Yahoo e-mail and instant messaging features, and that appears to be what will distinguish the service from many of its competitors.

By W. David Gardner

TechWeb News

The crowded VoIP sector is getting another major player. Yahoo Inc., which is entering the field with a service that in many ways is cheaper than Web phoning pacesetter Skype, and putting another nail in the coffin of traditional landline telephoning.

The Yahoo offering, to be available in 180 countries, will link with existing Yahoo e-mail and instant messaging features, and that appears to be what will distinguish the service from many of its competitors.

Calling plans will differ from country to country, but PC-to-PC calls among Yahoo users will be free. A "Phone Out" feature will enable callers to call from their U.S. PCs to public switched telephone network subscribers for a penny a minute to U.S. destinations and about two pennies to other countries.

The service and its linkage to other Yahoo features are largely based on technology developed by a team from Dialpad, which Yahoo acquired last year.

Another feature called "Phone In" is priced about $30 a year and enables a subscriber to receive incoming calls after picking a phone number.

Yahoo had previously offered some Internet voice calling features primarily through its instant messaging service, but Wednesday's announcement represents a major thrust into VoIP for the Internet media company.

Scores of firms have been piling into VoIP in recent months, putting pressure on traditional landline telephone companies, which are responding by offering their own VoIP solutions. Skype, which was recently acquired by eBay for $2.6 billion, is the pacesetter in free VoIP calling, with more than 68 million international users.

Vonage and AOL Time Warner offer paid Internet phoning in the U.S., with each firm claiming more than one million subscribers.