AOL and Microsoft to jump into the VoIP space

AOL and Microsoft are both gearing up to launch internet phone services, the companies announced on Tuesday.

AOL plans to launch its TotalTalk net phone service on 4 October. The service will let consumers make and retrieve calls, as well as send and receive email and instant messages, via a PC or home phone when using AOL's AIM Triton client, the company said. The instant-messaging software upgrade will be available later this week.

Meanwhile, Microsoft and Qwest Communications International said they are partnering to enhance VoIP, or voice over IP, service for small and medium-sized businesses.

The companies are the latest players to throw their hat into the increasingly crowded VoIP ring, which includes telecom giants such as SBC Communications, as well as start-up Skype, which is set to be acquired by eBay.

AOL said its TotalTalk service will include such features as a built-in dial pad for PC-to-phone calls and a telephone terminal adapter, or broadband router, to connect traditional telephones to a cable or DSL modem.

The company plans to sell a local plan with unlimited local calls for $18.99 per month; an unlimited calling plan that includes long-distance calls for $29.99 per month; and an international calling plan that includes unlimited domestic calls and discounts on overseas calls for $34.99 per month.

The service will also include call waiting, caller ID, three-way calling and voicemail integrated with email, AOL said.

Qwest plans to bolster its internet phone service, OneFlex, with Microsoft's Solution for Enhanced VoIP. The companies will integrate VoIP with email, instant messaging, collaboration and desktop services.

Tom Richards, executive vice president of Qwest's business markets group, said in a statement: "We'll be able to provide [small and medium-sized businesses] with powerful yet easy-to-use telephony and desktop capabilities."

The suite of services will be packaged under Qwest's OneFlex VoIP service. The companies expect the service to be available sometime next year.

Dawn Kawamoto writes for CNET News.com