Eventually, Net2Phone was forced to renegotiate its business relationship with Yahoo and raise its rates for the service. Yahoo and Microsoft passed the cost on to consumers, says Sarah Hofstetter, Net2Phone spokesperson. But they weren't the right customers to begin with. She says Net2Phone has experienced 25 to 40 percent quarterly growth of paying customers over the past four years. Net2Phone still provides free domestic calls in the United States or Canada for a five-minute limit before the calls are disconnected.
People can immediately redial and make another free, five-minute call.
Holdouts in a Popular Industry Overall, the popularity of IP telephony will quadruple this year alone, to about 9.5 billion paid minutes by 2001.