Dixons launches internet telephony service

Dixons Stores Group (DSG) is joining the flurry of companies launching internet-based telephony services.

The Group's FreeTalk service announced today requires a broadband connection, but doesn't run from a PC to PC unlike other similar services. An adapter makes it possible for users to make phone calls using their normal handset so there is no need for the user's computer to even be on.

Calls to UK fixed lines and other FreeTalk numbers will be free, while international rates compare 'favourably' with other services. Users will be able to take the adapter with them, plug it into a broadband service abroad for example, without running up expensive roaming bills. Mobile phone charges will be slightly pricier, although the company says it aims to make the price structure clear. Users will be able to choose their own UK or overseas dialling code and use up to 10 virtual numbers.

DSG is offering customers two ways of signing up for an account. For an initial outlay of £80, users will get an adapter and a year's subscription to the service. Alternatively a customer can buy an adapter for £20 and then pay £7 per month for the service on a pay-as-you-go basis.

After the introductory period all users will pay £7 per month for the service.

Simon Turner, DSG's group managing director said that with nearly seven million broadband users in the UK, the time was right for FreeTalk. He said internet telephony services. were now stable and easy enough" to launch to the average home user" and analysts predict that by 2008, half of broadband users will have given up having a home phone line.

Boxes containing a phone adapter and the cable to plug into a broadband-enabled PC will be available from this Thursday, September 29, in all four of DSG's retail chains: Dixons, Currys, PC World and The Link. The company said it is teaming up with AOL to offer reduced prices on broadband and FreeTalk bundles "in the next few weeks".