Ted Shelton describes what you need to set up as an Internet telco. No doubt about it, it is now possible to build a system with a couple of Linux boxes that does the same thing as an expensive telecommunications switch.

Of course Ted oversimplifies things a bit. In practice, the telephone industry puts a lot of barriers in your way to stop you from operating efficiently. They can cause all sorts of technical and regulatory problems for you. It’s also difficult to get people to leave their traditional telco. Telcos are increasingly depending on their line rental revenue for profitability. Calls are becoming a commodity business, and the small guy will eventually get badly hurt in the whole game.

The trick is to combine VoIP with an alternative access system to the regular phone line. Get the connectivity in there via cable TV or via wireless. Use the availability of inexpensive telephone service as a carrot to attract customers to your combined phone/cable tv/Internet service.

It’s all about critical mass.