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SINGAPORE : eBay took the industry by surprise earlier this week when it offered to buy over internet telephony service provider Skype for US$$2.6 billion.
The move has put the spotlight on the huge potential for web-based phone calls, signalling telecoms operators may be forced to look at expanding that side of their business.
Plans by eBay to take over Skype are sending a strong message that web-based telephony is here to stay and it is serious business.
The draw of VoIP, or voice over internet protocol technology, is that it makes international calls very affordable to web users.
Nirgunan Tiruchelvam, Investment Analyst, Phillip Securities Research, said: "VoIP will offer them a number of possibilities. Fundamentally its offers customers reduced cost or virtually no cost international calling. Looking forward what VoIP will offer the Singapore customer is the prospect of an acceleration of the diminishing of the fixed line network. In future, we may have a situation where the fixed line phone may not be of importance to a customer - you can purely survive with a mobile phone and a broadband connection.''
IDD operators in Singapore are already offering cheaper international calling through the internet for less premium quality calls.
But analysts say they may have to accelerate the push into a wider range of services with web-based long distance calling.
Nirgunan Tiruchelvam said: "They certainly will have to increase the importance of VoIP, possibly tie up with some of the VoIP operators existing within Singapore and use the expertise they have, to roll out VoIP.''
This may mean an improved growth outlook for companies such as MediaRing which offer low-tariff web calling.
And analysts say such counters are already starting to look more valuable. - CNA /ch
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