Google's challenge to Skype and phone companies

The big news is that Google has now gone into competition with Skype. Whether it hurts Skype remains to be seen. But it will definitely do a lot of damage to the phone companies like AT&T, BT and Telstra.

As ITWire reports, the new service allows Web users in the United States to make calls through its Gmail email service. The new service, which will roll out this week, is free for calls to the US and Canada at least until the end of the year. That's a few months of free calls. Google says it hopes to later offer the service to international Gmail users and possibly to businesses.

Commentators say it will totally screw Skype. Why would people waste Skype credits when they could just install a Google plug-in and start talking free? But for that matter, why would anyone want to buy a phone?


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