Wi-Fi, VoIP could merge with new wireless phones

NEW YORK (AP) — Two hot technology trends — Wi-Fi wireless Internet access and voice-over-Internet service — could come together soon with Wi-Fi phones that promise free or very inexpensive calls.

Voice-over-Internet carrier Vonage Holdings Corp. is testing Wi-Fi handsets it hopes to sell by fall. The devices would look like cordless phones and would likely be used in homes with Wi-Fi networks.

Rival Net2Phone Corp. is six months into a test of technology aimed at turning Microsoft Corp.'s Pocket PCs into Wi-Fi cell phone replacements.

The Net2Phone test hopes to deliver better quality audio than cell phones and a calling plan with low-priced minutes, said John Will, a vice president at DiamondWare Ltd., a software company working with Net2Phone.

Voice-over-Internet technology converts voice into packets of data and sends them like e-mails or Web pages. By bypassing much of the traditional phone network, the technology avoids access fees.

Consumer Internet phone services require users to have a broadband connection, generally DSL or cable. Wi-Fi's blazing speed works just as well.

So far, the market for Wi-Fi voice calls is "very small, it's nascent," said Elka Popova, an analyst at Frost & Sullivan, a consulting firm. That's because Wi-Fi phones can be used only in wireless "hot spots," which are far from ubiquitous.

"I like my office phone and I like my cell phone," said analyst Norm Bogen of In-Stat/MDR. "I don't really need another phone."

SpectraLink Corp. sells Wi-Fi phones to businesses that have wireless networking inside buildings where cordless and cell phones often don't work. The phones cost $400 to $650. Vonage's offering is expected to cost less.

The dream phone would switch from a cellular network to Wi-Fi seamlessly, getting the user cheaper calls whenever possible. But none is commercially available yet.