VoIP, Inc. To Pursue Cable Companies for Virtual Service Provider Deals

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FORT LAUDERDALE, Fla.--(BUSINESS WIRE)--Sept. 27, 2004--VoIP, Inc. (OTCBB:VOII - News) today announced that it plans to help cable companies capture a share of the Internet phone services business. Internet phone systems will likely drive down prices so much for voice service that it would not make sense for many companies to build their own networks

VoIP, Inc said on Monday it will provide wholesale Internet phone services to small cable companies in what it hopes will be a string of deals with some 1,100 smaller U.S. cable companies. Sprint has a similar deal with Time Warner Inc.'s (NYSE:TWX - News) cable arm, which plans to offer phone service to all its 10.9 million customers by year's end.

"We see a growing demand from mid-sized and smaller network service providers in the area of VoIP," says CEO Steven Ivester, "but the high price of operating a soft switch, termination network, billing system, and the related staffing is typically outside the cost effective range for these service providers. Our program is designed to be a very economical and efficient solution for these providers, enabling them to begin offering VoIP to their clients quickly and without a large investment of their time or money."

Cable companies have begun launching voice services just as the Bells have moved into video, reselling satellite television services and building their own video networks. Both industries expect a growing number of consumers over the next few years to buy a bundle of voice, video and high-speed data services from one company.

Small USA Cable companies belong to the National Cable Television Cooperative, a consortium of 1,100 smaller cable companies with about 14 million subscribers nationwide. Clive Raines President of International Operations of VoIP, Inc said the VoIP Solutions will be one of the first to give smaller cable companies a viable competitor to local phone services. http://www.cabletvcoop.org

"We can offer cable companies a way to sell phone service without the cost of investment in new systems or the learning curve or time to market problems while allowing the cable operators to retain ownership of their customers unlike reseller models from other voice providers," said Steven Ivester CEO VoIP, Inc. Cable companies "realize that if they don't get into voice, they'll allow (the Bells) and the incumbent phone companies to come in with a triple-play offering and hurt their business," Ivester said. "In a lot of ways it's seen as a defensive move, as protecting their embedded base of customers."

"Cable companies are very well positioned to leverage the investments they've already made in their cable infrastructure to get into the voice business and, we think, to capture valuable market share," said John Todd, VoIP, Inc. CTO.

According to a new white paper from research consultancy The Diffusion Group, the number of cable telephone subscribers is expected to grow from 2.4 million in 2003 to 11.5 million in 2010. This rapid expansion reflects a strong commitment on the part of cable service providers to expand voice offerings

With Comcast Corp. (NASDAQ NM:CMCSA - News), Time Warner and many other large cable companies pushing into voice-over-Internet services, about 12 million cable customers are expected to sign up for Internet phone service by 2008, according to industry research firm Yankee Group.

The cable companies are hoping to tap into the $200 billion U.S. telephone market by offering a myriad of bundled service options that promise to expand revenue per subscriber for carriers and pass on significant savings to consumers.

About VoIP, Inc. http://www.voipincorporated.com
VoIP, Inc. is an emerging global service provider of superior quality Voice over IP based solutions offering residential and business customers more user friendly and affordable ways to communicate. VoIP, Inc. also manufactures products and provides services to Internet Service Providers, Telecommunication Service Providers and Cable Operators in strategic countries around the world. VoIP, Inc, through its subsidiaries, provides a comprehensive portfolio of IP multimedia-based solutions ranging from subscriber based voice services, to SIP based infrastructure design and deployment, to broadband customer premise equipment design and implementation services, as well as engineering design, manufacturing and distribution of wireless broadband technology. VoIP, Inc. has applied for a patent for its state of the art VoIP Multimedia Terminal Adaptor which today supports the FCC Commission's desire for VoIP providers to deliver Emergency 911 Calling, Disability Access, and Law Enforcement Access capabilities to the marketplace.

Safe Harbor

Statements about the Company's future expectations and all other statements in this press release other than historical facts, are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as that term is defined in the Private Securities Litigation Reform Act of 1995. The Company intends that such forward-looking statements be subject to the safe harbors created thereby.

The above information contains information relating to the Company that is based on the beliefs of the Company and/or its management as well as assumptions made by and information currently available to the Company or its management. When used in this document, the words "anticipate," "estimate," "expect," "intend," "plans," "projects," and similar expressions, as they relate to the Company or its management, are intended to identify forward-looking statements. Such statements reflect the current view of the Company regarding future events and are subject to certain risks, uncertainties and assumptions, including the risks and uncertainties noted. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove to be incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected, intended or projected. In each instance, forward-looking information should be considered in light of the accompanying meaningful cautionary statements herein. Factors that could cause results to differ include, but are not limited to, successful performance of internal plans, the impact of competitive services and pricing and general economic risks and uncertainties.

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Contact:

     VoIP, Inc., Fort Lauderdale

     Steven Ivester, 954-434-2000

     sivester@voipincorporated.com

     http://www.voipincorporated.com
     or

     S & S Public Relations

     Lauren Berg (Media), 847-415-9338

     Source: VoIP, Inc.

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Steven Ivester