updated 3/8/2005 6:49:26 PM ET 2005-03-08T23:49:26

In another sign that Internet telephony is headed for the mainstream, America Online Inc. said Tuesday that it plans to launch a Net-based phone service for some of its members within the month.

The AOL offering will compete with traditional telephone companies, cable firms and the dozens of up-and-coming firms that transmit calls over high-speed Internet connections rather than the traditional telephone network.

Customers will continue to use their traditional phones, but they will plug them into adapters connected to their broadband source rather than the jack provided by the telephone company. Calls are received and placed just like on the old telephone network.

Companies have been using Voice over Internet Protocol, or VoIP, in the office for years. More recently, consumers have started to adopt the technology, signing up with cable companies and standalone companies like Vonage Holdings Corp. and 8x8 Inc. Even AT&T offers a VoIP service.

The biggest benefit for consumers has been low price — as little as $20 a month for unlimited national calls. More advanced features are also common. In fact, AOL's service is expected to work in combination with its popular instant-messaging technology, leveraging users' "buddy lists" so people can know when someone is available to talk.

"We can help mass-market adoption of VoIP," AOL Chief Executive Jonathan Miller said at a conference on Internet telephony. "We can utilize our national footprint. We can help the entire industry become well known."

Miller said the service would be targeted to specific markets initially with a wider rollout in the future. He did not indicate how much it will cost.

AOL, which grew explosively during the 90s with its easy-to-use dial-up service, has been struggling in recent years as subscribers flock to high-speed, always-on Internet connections. It's now offering services tailored specifically for broadband subscribers.

Copyright 2005 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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