Internet-based telephony saves consumers money by bypassing traditional carriers—but new software lets the carriers block those pennies-per-minute calls
The convergence of telephony and the Internet is a great thing for consumers. It makes voice-over-Internet-Protocol (VoIP) services, such as Vonage, Packet8, and Skype, possible.
In particular, Skype Technologies SA, in London, looms as a dagger poised to cut your phone costs—and your local phone company's profits. With its SkypeOut service, a call anywhere in the world costs about 3 US cents per minute. And when the recipient is also a Skype user, the call is absolutely free.
In some countries, such as Saudi Arabia, regulations protect a phone company's revenues, prohibiting customers from saving money by making phone calls using any service other than the national carrier, Saudi Telecom, based in Riyadh. Skype users there have gleefully flouted those regulations, paying cheap local tariffs to access the Internet and use it for their calls, instead of directly using Saudi Telecom's expensive long-distance and international calling services.
Although these Skype calls travel along Saudi Telecom's network, the national carrier had been helpless to prevent the practice—VoIP phone calls were just ordinary data packets, indistinguishable from Web and e-mail traffic. Until now. A seven-year-old Mountain View, Calif., company, Narus Inc., has devised a way for telephone companies to detect data packets belonging to VoIP applications and block the calls. For example, now when someone in Riyadh clicks on Skype's "call" button, Narus's software, installed on the carrier's network, swoops into action. It analyzes the packets flowing across the network, notices what protocols they adhere to, and flags the call as VoIP. In most cases, it can even identify the specific software being used, such as Skype's.
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