Nov. 14 (Bloomberg) -- If a telephone company had a heart, Google Inc. would be inspiring terror in it.

As the newspaper, book and video industries can attest, Google has a knack for invading established markets and turning them upside down. Next up are the phone companies: Google Voice, still in testing, provides a free, powerful suite of Internet- based services that makes it a personal communications hub.

At least one carrier isn’t waiting to see what happens next. Instead, BT Group Plc, the U.K. telecommunications giant, is trying to beat Google at its own game.

BT last year purchased a Silicon Valley startup called Ribbit that has begun testing Ribbit Mobile, which matches Google Voice in some areas and even exceeds it in a couple. And win, lose or draw, BT deserves some respect for fighting back.

Google Voice, which for the moment requires an invitation, both replaces and expands many of the functions provided by phone companies. To get the most from it, you need a new, Google-provided phone number. I chose one in area code 650, which covers the northern end of Silicon Valley. It somehow seemed appropriate.

I then enrolled all my other phone numbers -- home, office, personal wireless, plus a couple of other wireless phones I’m testing -- on the Google Voice Web site. Individually, those phones continue to function as usual. But when someone dials the Google Voice number, the fun begins.

Bells Are Ringing

First, the phones ring -- all of them, at the same time. In other words, if you are using Google Voice, you will never miss a call, no matter that you are in transit and someone is calling your office. You can also establish rules for each phone -- for example, if you don’t want your home phone to ring between midnight and 7 a.m. on weekends.

If Google Voice can’t reach you, or you choose not to be reached, it takes a voicemail message that you can eavesdrop on and interrupt if you decide to take the call after all.

Messages can be played back from any phone or the Google Voice Web site. But there’s more: Messages are automatically transcribed and forwarded to you via text or e-mail.

These auto-generated transcripts, which show up within moments, usually provide the general gist of the message, though they aren’t perfect. In one of my tests, the sentence “She’s being picked up at school” showed up as “She’s be picked up. That’s cool.” Google being Google, the likelihood is that feedback from early users about the accuracy and usefulness of the transcripts means they will get better over time.

Free Calls

The list goes on and on: free domestic and cheap international calls, and free text messages, from the Google Voice Web site. One-button recording of incoming calls. Calls transferred from one phone to another in mid-conversation.

You get the picture: an enormous array of services, all free, all from one source that isn’t even a telephone company. Moreover, Google’s ambitions seem far from sated; earlier this week, technology blog TechCrunch reported that it has purchased Gizmo5, which competes with Skype, the voice-over-Internet service EBay Inc. is selling.

No wonder Apple Inc. and AT&T Inc. have been embroiled in a messy fight over a Google Voice app for the iPhone. Google Voice effectively takes over the customer relationship, converting the entire global telephone network into merely its back end.

Unlikely Candidate

BT, with roots stretching back to the U.K.’s 19th century General Post Office, would seem an unlikely candidate to compete with the Google juggernaut. But Ribbit Mobile, which launched in beta form earlier this month, matches up well.

As with Google Voice, you can either use an existing phone number or sign up for a Ribbit number. I used an existing mobile number; following directions on the Ribbit site, I entered a long string of digits and symbols on the phone, after which Ribbit placed a test call to the phone that I was instructed not to answer.

From then on, all calls were diverted to the Ribbit voicemail system, where I had a set of controls similar to those in Google Voice: retrieve by phone, retrieve from the Web site in audio and transcribed form, automatic transcriptions sent via text or e-mail.

Ribbit, though, adds a couple of wrinkles that Google Voice doesn’t offer, at least so far.

Human Involvement

One is the option of having a human help transcribe your messages, making them more accurate without appreciably slowing the process. The feature is free during testing but will eventually be part of a paid tier of extra services.

Ribbit also lets you place and receive calls directly from your computer, using its microphone and speakers. As more airlines add Internet access, the feature opens up the possibility of in-flight Web-based calling -- as long as the other passengers don’t end up locking you in the restroom.

The caller ID function can be linked to feeds from social- media sites such as Facebook and Twitter, so you can see not only who is calling but what they have been up to. And Ribbit is encouraging outside developers to write apps that will extend the service’s functionality.

Ribbit and Google Voice are by no means finished products; features are still being tweaked, and issues of privacy and regulation are far from resolved. But the glimpse of the future they provide must be a sobering one for carriers -- even for BT, which seems to have decided to shake up its own business rather than let Google do it instead.

(Rich Jaroslovsky is a Bloomberg News columnist. The opinions expressed are his own.)

Click on “Send Comment” in the sidebar display to send a letter to the editor.

To contact the writer of this column: Rich Jaroslovsky in New York at rjaroslovsky@bloomberg.net.

Last Updated: November 12, 2009 21:00 EST