VoIP: Not The Cheapest Calling Option?

Traditional telcos can often offer better rates to call Israel than Skype, Web-calling expert Jon Arnold writes in his blog. I have found the same to be true when calling Russia. What this means: Migration from landline to VoIP could slow down.
Olga Kharif

I just read Jon Arnold's blog on Skype. And -- surprise! -- Arnold thinks that since Skype recently raised its rates, the service, allowing for Web-based calls, is no longer the cheapest way for people to make all types of international calls. Traditional telcos' services can, in fact, prove to be cheaper when calling countries like Israel, he says. My personal experience shows that using prepaid calling cards is still cheaper when dialing Russia, meanwhile.

Indeed, as services like Skype, owned by eBay, start to desperately search for ways to make money, the notion that Voice over Internet Protocol (VoIP) calling is the cheapest way to make international calls may not hold true for much longer.

Just to be clear, I don't think that's going to stop users' migration to VoIP -- a migration that, according to In-Stat, is accelerating in the U.S. Still, higher prices could cramp VoIP's image as the cheapest phone service around. And, ultimately, this could slow landline-to-VoIP migration down a bit. After all, most people move to VoIP because of its low price. And if VoIP prices keep on creeping up, some consumers may stick with their traditional telcos longer than some analysts expect today.