Morpheus finds its voice

Morpheus users who rely on the peer-to-peer service to swap files will soon have another option to get connected: The Morpheus Voicebox, which lets you turn a household landline phone into an Internet-based, Voice-over-IP telephone.

StreamCast Networks Inc., the parent company of Morpheus, is teaming with i2Telecom International Inc., a provider of VoIP services for businesses, to begin offering the service this week.

The Morpheus software has been downloaded more than 122 million times since it launched in 2001, and the company estimates 250,000 to 300,000 people use the application every day. This wide user base is the first target for Morpheus Voicebox.

"Morpheus has millions of loyal customers around the world. Their users are tech savvy, and most of them have broadband connections, so this seemed like a natural fit," says Rick Scherle, i2Telecom's vice president of marketing. This deal marks the first time i2Telecom's services have been offered to consumers.

The Morpheus Voicebox is available from for US$49.95. The device plugs into your phone and your computer's Internet connection, and lets you use either your regular landline connection or the VoIP connection, which you acces by pressing pound before dialing a phone number. Users also pay a one-time setup fee of US$25, plus fees for a choice of subscriptions.

Payment plans

The Morpheus Voicebox works much like the popular VoIP service offered by Vonage Holdings Corp. But unlike Vonage's service, this is not intended to replace your traditional phone line, Scherle says. The Morpheus Voicebox is designed to offer substantial savings on long-distance calls, he says.

Users must purchase one of the monthly subscription plans. Calls to other Morpheus Voicebox users are free, while other calls are billed according to the plan selected. The low-end Community Plan costs US$6.95 monthly, and provides calls to all telephones in the United States and Canada for 3.9 cents per minute.

The Millennium Plan, which costs US$14.95 monthly, includes 1000 minutes of calling to any number in the United States or Canada. The next 1000 minutes of calls to the United States and Canada cost 1.5 cents per minute; after that, they increase to 3.9 cents per minute.

The Infinity Plan, priced at US$24.95 monthly, includes unlimited calls to any phone number in the United States or Canada. Pricing for overseas calls is not listed on any of the plans, but a statement issued by i2Telecom and StreamCast Networks promises "rock-bottom international calling rates."

New territory

Morpheus' peer-to-peer network is, of course, often used by many of its members to illegally download copyrighted music. StreamCast is currently involved in a legal battle with the entertainment industry. The company is one of the defendants named in a lawsuit filed by the Recording Industry Association of America, the Motion Picture Association of America, and the National Music Publisher's Association of America. Those groups are asking the courts to hold makers of peer-to-peer software liable for the misuse of their products.

Scherle acknowledges that i2Telecom considered this before agreeing to work with StreamCast.

"I think you have to draw a careful line. It's similar to the difference between the person who makes the copy machine and what the copy machine is used for. I think there are a lot of legitimate uses for file-sharing services, and I think that Morpheus has gone out of its way to promote their service for its good, legitimate uses," he says. "We wouldn't stop doing business with Xerox (Corp.) because someone might use a copier to make illegal copies."

StreamCast sees the Morpheus Voicebox as an opportunity to extend the Morpheus brand, and considers the VoIP product a perfect fit for the company.

"The Morpheus software is highly disruptive, just like VoIP is highly disruptive to the telecommunications industry," says Michael Weiss, StreamCast CEO. "It changes dramatically what's taken place up until now. VoIP lowers costs and changes the way people communicate. Morpheus is disruptive to the music and movie industry in the same way. These technologies are disruptive the same way that television was disruptive to radio."

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