Since its inception, the Internet has performed poorly in the area of digital voice transmission. But a new technology known as Voice over Internet Protocol (VoIP) can deliver high-quality long-distance phone service over the Web for free, or for a minimal charge. VoIP is getting considerable attention from companies of all sizes because it is perceived to be a major money-saver, and the technology is expected to deliver substantial benefits relative to traditional telephone services.

But before early adopters and IT managers decide to cancel their existing landline phone services, they may want to consider the downside of VoIP applications. Since VoIP phone applications use the same technology as computers, they are susceptible to common network glitches--which raises some red flags for individual users and chief information officers alike. Personal VoIP users express worries that a broadband connection might fail during urgent calls or 911 emergencies, and chief information officers fret over whether their businesses can afford erratic voice connections in mission-critical situations.

Certainly VoIP promises to deliver substantial savings on telecoms bills, and the idea of making phone calls over a computer network is a natural progression for digital communications. However, this new Internet-based service presents challenges that must be overcome if VoIP providers want businesses to abandon their standard landlines and conduct all telecommunications over the Internet.