The ability to make calls over the Internet has been around for years but is just now really catching on. Its popularity is growing as more consumers trade dialup Internet service for broadband, almost the only essential for VoIP service. Investors are bullish over the VoIP market because they see the Internet as the gateway to all voice and data communications. It’s created quite some chaos in terms of investments.

Vonage raised $200 million in one round of funding last Spring and has now filed to go public. Skype was bought by eBay Inc. for $2.6 billion in cash and stock in September. According to VentureOne, a unit of Dow Jones & Co., more than $700 million was invested in VoIP startups in 2005, with 76 companies getting funding.

Despite the heightened interest, venture capitalists think there’s room to make money. As the VoIP market expands, the companies needed to support and bring services to the market will be numerous.

Click Here for the Full Article