AOL will bring Net phone service to 40 cities

Company will offer prices as low as $13.99 per month as part of an aggressive rollout campaign.

The story "AOL will bring Net phone service to 40 cities" published April 7, 2005 at 8:19 AM is no longer available on CNET News.

[Dachi]

They don't have to be cheaper

I don't know how many long distance minutes you get with the $14 ($19 after 5 months) plan, but the plan has some potential for success.

There are some downfalls though.

First, the service is tied to AOL for broadband. A non AOL broadband user wanting the service will also have to purchase AOL for broadband (at least that is what I gathered from the article).

The second problem is this: Most VoIP users to date are usually fairly technical people. The $19 plan is marketed at people who already have AOL for broadband, most of these people are not technical (else they wouldn't be paying an extra $15 on top of broadband for AOL's services).

But AOL is the 150 lb gorilla (Atkins), if they offer a solid product this could secure them a very nice position in something outside the dialup market.

The only problem is that AOL is in kind of a catch 22 situation. They need to do something because their dialup users are leaving, but they also have to be careful when offering all these great broadband features not to chase even more users off of dialup.

Marketing VoIP to AOL subscribers might just be the last little push they need to drop AOL for broadband. (e.g. most defecting AOL users don't keep AOL for BB)

That said, working for a cable broadband service provider, I welcome this move from AOL.