Guide to Internet-based Long-Distance Calling

It has been suggested that "Internet calling" may provide consumers with a cheaper long distance service alternative to calls billed to consumers through their local telephone company by traditional long distance service companies. What follows are a series of questions the People's Counsel has answered regarding this new business of "Internet calling," and how consumers can derive benefits and save money.

Question:What is "Internet calling?"

Answer: "Internet calling" allows people to place calls between personal computers (PC) or between a PC and a regular telephone.  The calls are sent over computer networks rather than the traditional voice networks.  The computer user(s) can speak and listen through the use of speakers or headsets plugged into the computer.

Question: Who can place an Internet call?

Answer: Anyone can place an Internet call through an Internet calling company so long as at least one computer is involved.

Question: Is the quality of an Internet call different than regular phone calls?

Answer: Yes. Today, calls placed over the Internet generally experience lower sound quality. Internet calls may experience echos, crackling, background noise (if a headset isn't used), and brief lapses in the conversation flow.  Of course, new technology will help to increase the delivery.

Question: Are there any benefits to placing Internet calls?

Answer: Possibly, depending on your calling needs. If you have a computer, placing calls to another computer is free through most, if not all, Internet calling companies.  If you use your computer to call a telephone, then several Internet calling companies will place the calls for free or for a low per minute rate.

Question:Which companies provide Internet calling and what are their rates?

Answer: There are several companies that facilitate Internet calling.  The following is a sample list of some of the companies providing this service:

Keep in Mind!

These rates are in addition to the cost of the local call needed to connect with the company in order to place the long distance call.  Companies that offer phone to phone rates list different rates for each country.  OPC advises all consumers to carefully read all rates and terms of service before ordering any services.

Question: What is a 'virtual calling card?"

Answer: A virtual calling card provides the same service a regular prepaid telephone card does, except the customer is given a phone number and pin number instead of an actual card. Some Internet calling companies also offer discounted long distance rates for calls made between two telephones. This requires a pre-payment on a "virtual calling card."  A customer enters their credit card information on the company's web site, and makes a payment on a virtual card.  A phone number and pin number are displayed, which the customer can use from any phone to make calls that will be deducted from the calling card.  An actual card is never sent to the customer.

Question:Where or how can I purchase a "virtual calling card?"

Answer: Consumers may buy a "virtual calling card" by pre-paying for time with a credit card through the company's web site, or by buying a card at various locations such as newsstands and retail chains.

Question: Which government agency has jurisdiction over Internet calls?

Answer: This is not completely clear yet.  OPC has jurisdiction over local calls and the Federal Communications Commission (FCC) has authority of long distance calls.  The Internet remains unregulated.  Hopefully, as the technology continues to develop and more companies enter this area of communication, a clear distinction will be made with respect to who consumers can turn to when they have a complaint or have questions about Internet calling.  Of course, there remain the traditional places customers can call regarding any company, such as the Better Business Bureau and the Federal Trade Commission.

Source: The Office of the People's Counsel for the District of Columbia