Microsoft adds PC-to-phone service to MSN Messenger

Microsoft and US phone giant MCI have signed a deal to enter the fast growing computer-to-phone VoIP service. The snappily titled ‘MCI Web Calling for Windows Live Call’ will be available through Windows Live Messenger, the replacement service to MSN Messenger.

The service is currently being tested by MCI and Microsoft as a beta programme to subscribers within the US. However, the companies say they plan to extend the PC-to-phone calling services to the UK, France, Germany and Spain over the next few weeks.

The announcement comes less than a week after search competitor Yahoo! launched its own PC-to-phone VoIP service via its Yahoo! Messenger service and only a few weeks since Google introduced its Click to Call VoIP feature for its advertising network.

Microsoft and MCI say that subscribers will be able to send and receive calls from more than 220 countries with rates starting at $.023 per minute to the US, Canada, the UK and Western Europe during the beta testing period. The companies say that the final pricing will be determined when the product officially launches in 2006.

However, since Yahoo! is offering prices as low as a cent to call in the US and the UK and less than 2 cents to call to many other countries around the world, it is likely that the price pressure is going to be down rather than up.

Customers will be able to sign up for the MCI Web Calling service via the Windows Live Messenger client. MCI will manage customer registration, terminating calls, customer account management, customer support and billing for the PC-to-phone voice service. As with the Yahoo! service, customers will be able to buy phone credit from MCI in $5, $10 or $25 blocks for use with the service.

The new VoIP service will offer benefits to both partners. Microsoft gets a consumer-based VoIP partner at a time when its major competitors are also adding similar services. Meanwhile, MCI a global telecoms company adds users to its IP infrastructure and nascent VoIP services while countering a threat to its bottom line through the erosion of its landline phones business.