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Story URL: http://networks.silicon.com/telecoms/0,39024659,39155749,00.htm

Tesco debuts 'VoIP for all'
"Simple service" to rival Skype

By Sylvia Carr

Published: Thursday 19 January 2006

Retail giant Tesco has launched a new voice over IP service aimed at the mass market, which allows customers to place phone calls over the internet via their PC.

The goal is to make it easy enough for anyone - even those who've never heard of VoIP - to use.

Alex Freudmann, commercial manager at Tesco Telecom, told silicon.com: "Customers don't care how they make calls. They're looking for low tariffs and a simple service."

The Tesco Telecom service requires customers buy a £19.97 set-up package which includes a handset and software installation CD. The handset is plugged into the USB port of a PC, and works like a normal phone, allowing customer to dial numbers on the keypad and answer incoming calls.

The package comes with £5 worth of calls, free voicemail and one incoming phone number, at which the customer can be reached by others.

Calls will be charged on a pay-as-you-go basis and can be topped up like a mobile phone service. Freudmann said Tesco's internet phone shares the "same principles and good values" as Tesco's mobile offering.

Tesco Telecoms' partner to deliver the service is Freshtel, an Australian internet phone company.

Talking to other Tesco internet phone users will be free, while it's 2p per minute to call landlines across the globe or international mobile phones, and 10p per minute to call UK mobiles.

The pricing compares to the popular VoIP app Skype, which charges similar per-minute rates and also charges for an incoming phone number (€10 for 3 months, €30 for a year) or voicemail (€5 for 3 months, €15 for a year). USB handsets are available for Skype but are sold separately.

The VoIP offering will be available in 15 Tesco stores this week and will be rolled out in the remaining shops over the next two months.

Along with Skype, Tesco's competitors in the VoIP space include Vonage, which offers an internet phone service in the UK that requires the installation of a hardware router.