From the November 2004 issue of Entrepreneur

You liked the price cuts. Now comes part two: VoIP innovation. The Packet8 Desktop VideoPhone from internet phone company 8x8 lets you see and hear calling partners.

Full-motion video calls have arrived-some 40 years after Bell Labs introduced its Picturephone and long after we tired of visiting it at Disneyland. The Packet8 Desktop VideoPhone is available on 8x8's websiteand through large computer retailers online and off for $299, or $499 for two (all prices street).

It's not one of those kludgy computer video solutions we've seen before. And it doesn't require special, per-minute service charges since 8x8 isn't a traditional phone company delivering video over the traditional phone network. VideoPhone is a creature of the new, unregulated phone network. So while arguably it's the first, it won't be the last such device we'll see.

A broadband connection of at least 128Kbps is needed for real-time video and voice quality, says Bryan Martin, chair and CEO of 8x8 in Santa Clara, California. The Packet8 phone is definitely a convenient way to get "just like being there" video. Plug it into an Ethernet port on your broadband router, dial an activation code, and you're in business. It finds its own IP address, can be used across an office LAN, and is easily moved to other locations and connected to a TV or large LCD. It doesn't cost much more than most office phones. In fact, except for a barely noticeable camera and a 5-inch active-matrix LCD, the VideoPhone looks like any office deskset.

You'll need a Packet8 calling plan, which starts at $29.95 per month for unlimited calls to any North American number and unlimited free calls to other Packet8 subscribers worldwide. Most of the VideoPhone's calling features-from voice mail to three-way conferencing to call forwarding-are delivered via the calling plan, not the phone. Reception is great: clear audio and crisp, full-color images on an LCD that's just the right size.