"The key with IP telephony is being able to manage the usage over the network," says Mr. Bard. "Net2Phone has the systems in place with the use of its parent network. It's able to manage each and every call."
In the company's prospectus, AT&T Jens (a Japanese affiliate of AT&T [Nasdaq: T]), ICG Communications (Nasdaq: ICGX), IP Voice.com (OTC BB: IPVC), ITXC, OzEmail (recently acquired by MCI WorldCom [Nasdaq: WCOM]), RSL Communications (Nasdaq: RSLC), Deltathree, and VIP Calling are all named as competitors in the voice-over-the-Internet services business.
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If anything, massive competition -- rather than massive demand -- is what's driving voice over IP. Because the barriers to entry in IP telephony are so much lower than in traditional switched networked voice services, literally hundreds of companies have entered the market in the past six months.
Dr. Ganor estimates that it costs 27 times more to build a traditional network than it costs to build a new IP network, and says that networks using IP platforms are far cheaper and easier to maintain.
As an example, VocalTec's CEO said that a company like ITXC can enter a country and set up voice-over-IP capabilities in "not a year, not six months, not a month ... a week."
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