| VoIP (Voice over Internet Protocol) is a new brand of | | | | consequently follows. Total market revenue for |
| technology based on the Internet, which has | | | | prepaid calling was $2.7 billion in 1999. By 2002, about |
| modernized the phone industry. VoIP allows for an | | | | 29 percent of prepaid calls have become VoIP, much |
| inexpensive way of transmitting voice signals over the | | | | higher than its corresponding value in 1999. Prepaid |
| Internet; hence it offers the possibility for Internet users | | | | VoIP service is causing a significant impact wireless |
| to have their phone calls done over the Internet. The | | | | telecommunications as well, plummeting the cost of |
| advantage of VoIP over previous technologies for | | | | prepaid calling cards to as low as 1.5 cents per minute |
| voice transmission over computer networks is that it | | | | of call, with half-cent minutes not too far in the future. |
| mitigates long delays as well as loss of quality. Before | | | | Prepaid calling cards have become more affordable to |
| VoIP, Internet callers had to wait for about a minute or | | | | a larger segment of the population. |
| two to completely receive the conversation from the | | | | Major phone service carriers are put in a position of |
| other side before they could speak--a time-consuming | | | | reconsidering the swelling telecommunication market |
| ordeal indeed. Internet calling was therefore, in most | | | | share of VoIP. Some of the phone service providers |
| respects, inconvenient. The service quality of calls was | | | | have ignored the feasibility of VoIP in the past, but are |
| also not as good as it is now. Furthermore, the costs | | | | now reconsidering it because prepaid calling services |
| of making an Internet call are quite high then. Having | | | | are within the reach of the mass market. Among the |
| found a solution to solve all these previous concerns, | | | | emerging VoIP carriers are Delta3, Vocall, and RSL |
| VoIP encouraged the widespread use of Internet | | | | Communications, which are becoming known as |
| calling in recent years. The burgeoning VoIP technology | | | | Internet telephony service providers. |
| still has so much room for improvement in terms of | | | | As the level of VoIP quality consistently keeps on |
| service optimization. Companies like Skype and | | | | improving, a definitive shift from traditional phone calling |
| Vonage have pioneered the VoIP service business by | | | | towards VoIP routing is guaranteed to take place for |
| providing customers with offers that are far more | | | | all toll calling. For this to happen, Internet telephony |
| enticing than corresponding offers by regular phone | | | | service providers need to restore the confidence of |
| service providers. However, some of these VoIP | | | | consumers that when they use a VoIP prepaid calling |
| service providers, being the businesses that they are, | | | | card with a more affordable price they will always be |
| overcharge customers for aim of maximizing their | | | | able to complete their calls with reasonable level of |
| profits. High prices are justified through brand | | | | quality. Consumers are typically willing to trade off |
| reputation, for instance. Despite the apparent extortion | | | | quality for savings, particularly with prepaid calling cards. |
| by VoIP service providers, cheaper alternatives are | | | | With a prepaid call, consumers can opt when the |
| actually available out there. One of these cheaper | | | | savings offset the concerns about call quality. |
| alternatives is a VoIP prepaid calling card. VoIP prepaid | | | | Overseas call is one concrete example of such |
| calling cards typically offer more equitable deals than | | | | trade-off, particularly calls to high-tariff countries in |
| most large VoIP service providers. | | | | South America and the Middle East. Emigrants from |
| With the escalating popularity of VoIP services, an | | | | both regions are large markets in the United States for |
| imminent boost of the prepaid calling card industry | | | | prepaid calling cards. |