Vonage, a major US voice over IP company, has entered the UK market with a £9.99 a month service.
For this price, users get unlimited local and national landline calls in the UK. They also get mobile phone calls for a reduced 15p a minute during the day, 10p a minute in the evening, and 5p a minute at the weekend.
In addition, there are also reduced rates for international calls. Other features which come in the £9.99 package include voicemail, call waiting, call diversion, three-way calling, a selection of dialing codes that can be used and call transfer.
VoIP sees voice calls being digitised over data lines, which allows call costs to be reduced. Vonage is competing against BT and other firms who already offer VoIP services.
Like rival services, the Vonage package allows users to use a standard phone to make the calls, via a special adaptor supplied with the service.
In addition to the £9.99 charge, users will need a separate broadband connection and line rental to use the service, so only users who make large numbers of local or national calls are likely to sign up.
Vonage is also planning to introduce a Wi-Fi phone that can be used over wireless networks in the future.