chafic.net

While reading the Money section of yesterday’s copy of USA Today I came across an interesting article.? AOL plans to offer a free US phone number to users of AIM. This new product offering will be called AIM Phoneline. This will surely mean trouble for Skype and other VoIP providers, as getting a phone number to receive incoming phone calls via Skype costs a bit over $3 a month.

AOL plans on marketing their new addition to AIM to the younger generation of internet users as a cost effective way of not having to pay landline bills. In addition to that, AIM Phoneline Unlimited will also be debuting which will allow for unlimited outgoing calls to anywhere in the US and to 30 international countries for $14.95 a month, which is bound to attract a lot of attention, as Skype’s outgoing call system is credit based and other VoIP providers’ offerings are higher priced.

Is Skype going to lose all of its users to AIM Phoneline? I doubt it, simply due to the switching costs associated with making the move over to AIM Phoneline. AOL will surely tap the college and the recent college graduates market that wasn’t completely tapped by Skype. But with no announcement of whether AIM Phoneline will be compatible with mobile devices, I think Skype still has the edge for the time being.

I predict it won’t be long before Microsoft’s MSN Messenger and Google’s Talk add features similar to AIM Phoneline, and that is when the fun starts as to who will succeed in dominating the VoIP market. Or will Skype continue to dominate?