AT&T Plans for VoIP Investment to Impact the Virtual Office

By Susan J. Campbell, TMCnet Contributing Editor

A decade ago, the thought of AT&T (News - Alert) leaving its landline roots behind would have been laughable. Today, as opportunity continues to explode in wireless and IP networks, the telecom giant is seeking to capitalize on growing opportunities. As a result, traditional phone service will be put to rest as the company invests $14 billion over the next four years.

As highlighted in this Phone (News - Alert).com blog, AT&T is putting its future into VoIP and the consistent growth of the virtual office. Is AT&T Chairman Randall Stephenson off his rocker? Maybe, maybe not. Let’s take a closer look at the current market and where it’s going. There are still roughly 112 million switched circuit lines in operation, but there were 192 million 10 years ago. These numbers suggest that while traditional phone service isn’t dead, but it’s on a rapid decline.

Believe it or not, the technology that supports the virtual office has been available for the past 20 years, but only in the past five has it really improved enough to create an optimal working environment. For instance, VoIP phones could be acquired in 1992 and plugged into the back of the computer. But, VoIP wasn’t interconnected with the switched phone network, so no one was likely to call.

Times have changed and now VoIP calling is becoming the demanded method for many in the virtual office – or even traditional office – environment. As demand continues to grow, and AT&T is betting that it will, more of the population is expected to be reached. If the market develops as predicted, VoIP will be carried over fiber, broadband and LTE (News - Alert), reaching 99 percent of the U.S. population in a very short amount of time. In the end, even those who weren’t searching for the perfect virtual office environment will be able to set one up in their own home.

For virtual office solutions providers such as Phone.com (News - Alert) that offer VoIP services, this announcement from AT&T should mean expanded opportunities over time. As AT&T is transformed into a broadband pipeline provider, the primary focus should be quality of service delivered. Considering the competition that will still exist in this arena, AT&T can’t afford to deliver anything less.

This will be one area to watch, however, as AT&T attempts to sell its own VoIP services over wireless and terrestrial broadband. The issue of fair competition comes into play, with some wondering if AT&T will take advantage of its own position as the broadband provider, favoring its own service in the process. The FCC (News - Alert) will have to be paying attention, ensuring a level playing field. As this service evolves over time, however, it will be interesting to see how it plays out in the market.

Edited by Amanda Ciccatelli