Subject: [NEXTEL-1] VoIP goes to city hall

From: [email-masked]
Date: Sat, 13 Sep 2003 04:42:43 -0400

-------- Original Message --------
From: [email-masked]
Subject: VoIP goes to city hall

VoIP goes to city hall
By Ben Charny 
Staff Writer, CNET News.com
September 5, 2003, 1:32 PM PT
http://news.com.com/2100-1037-5072093.html 

The city of Coldwater, Mich., this week became the nation's first municipality 
to sell Voice over Internet Protocol, or VoIP, telephone service to its 
residents. 
The city is trying to create competition for Verizon Communications, the lone 
telephone provider in this town of about 10,000 residents, said Linden Cox, the 
communications manager of Coldwater's Board of Utilities.

It's also hoping to get a competitive advantage over Charter Communications. 
Charter and Coldwater's Board of Public Utilities both sell broadband access, 
which is required for VoIP service. Charter Communications, however, doesn't 
sell a VoIP service. VoIP is a way of using the Internet rather than 
traditional telephone networks to place phone calls.

Coldwater's move is an example of a new tactic that may be used by cities that 
want to break a local communications company's monopoly by going into business 
themselves. While more than 200 cities sell broadband access, Coldwater is the 
first to sell a phone service that uses VoIP, which is considered an attractive 
extra to lure in more broadband customers. More cities are expected to follow 
Coldwater's lead.

"It's not so much the revenue but introducing the notion (that) there's another 
business in town to contend with," Cox said. "Hopefully, this will bring out 
some lower pricing and get us some more broadband customers."

In so doing, the municipalities are creating a niche market for VoIP service 
providers. For instance, Coldwater chose to resell VoIP dialing plans from 
Vonage. Vonage's national account manager, Dan Elwell, said Friday that the 
company is in talks with several other municipalities, but he wouldn't identify 
them.

Rim Ransberger, Charter government affairs vice president, played down the 
importance of Coldwater's VoIP service. 

"Obviously, it's another piece of a puzzle, but I'm not so sure it's 
tremendously important in the competitive environment."

A Verizon Communications spokesman had no immediate comment.

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