Like Yahoo, SIPphone offers Penny A Minute Calling

Yahoo was the first one to launch a salvo at Skype by offering a penny-a-minute calling, betting that its low price offering would help it gain market share and lure users away from Skype. (Service will be available next year… but the press release is already out!) Well, now there is word that SIPphone will be announcing a 1 cent per minute calls anywhere in the US tomorrow. (Mac users can simply use the Gizmo Project client to make outbound calls!) Trying to outdo Yahoo (which is offering penny-a-minute calls as a promotion), SIPphone is going to make 1 cent/minute calls a standard rate for PC-to-PSTN calls.

Ironically, Microsoft will start allowing PC-to-PSTN calls tomorrow using MCI network. (I had reported this earlier.) Their price: 2.3 cents per minute. This is turning into a brutal price war, and sooner or later others such as Skype, Vonage, Sun Rocket etc will have to respond. I do wonder what Jeff Pulver thinks about this? On further thought, Skype predicted sales of around $200 million for 2006, and a nice chunk of it was supposed to come from licensing revenues. I wonder how big is this PC-to-PSTN market? Not very, I assume!

PS: Andy Abramson, beat me to the punch and blogged the news before even i could turn on my Powerbook. What’s worse, he was sitting right next to me, and sipping his expresso. Also, why does Microsoft come-up with product names only a sadist can love. “MCI Web Calling for Windows Live Call” ….