Perhaps the biggest news in the VoIP space, ever is this announcement. I have been saying for a while that these devices need to be under $100 for consumer adoption. 8x8 did a very smart thing with this announcement:

FOR IMMEDIATE RELEASE

8x8 SLASHES PRICE OF PACKET8 VIDEOPHONE TO $99

SANTA CLARA, Calif.  – April 14, 2005 -- 8x8, Inc. (Nasdaq: EGHT), provider of  Packet8 broadband voice over internet protocol (VoIP) and videophone communications services, announced it has reduced the price of the Packet8 Broadband Consumer VideoPhone from $250 (after rebate) to $99 and decreased the monthly service fee from $29.95 to $19.95, effective immediately.

Available direct to consumers at www.packet8.net, the newly-priced Packet8 VideoPhone is being sold with a two year service plan which includes unlimited voice and video calls worldwide to another Packet8 Videophone as well as unlimited local and long distance voice-only calls to any phone number in the U.S. or Canada. The $19.95 per month, 24 month service plan carries an early termination fee of $299. Existing Packet8 VideoPhone subscribers will see a decrease in their monthly service of $10 beginning with their May 1 billing statement.

Motivated by over 12 months of consistently positive user reports and outstanding technology reviews, 8x8 decided on an aggressive price reduction strategy to accelerate the rate at which consumers are subscribing to the Packet8 VideoPhone service, the first and still the only broadband consumer videophone solution on the market today.

"We believe that by dramatically lowering the cost of entry, we will diminish the hurdle facing consumers who have shown strong interest in purchasing our broadband videophone but are precluded from doing so because of the price," said 8x8 Chairman & CEO Bryan Martin. "Once we get our technology into the hands of more consumers, we feel confident its appeal will take hold and bring about the critical mass necessary to make videophone conversations an everyday experience."

Since its introduction in June 2004, the Packet8 VideoPhone has been recognized in numerous business and industry publications including the Wall St. Journal, The New York Times, the San Jose Mercury News and Laptop Magazine. Some of the season's most popular television shows - Alias, King of Queens, Will and Grace, Third Watch and Law and Order SVU - have incorporated the VideoPhone on their sets and in the plots of various episodes.

"8x8 has established itself as a leader in videophone technology and, as such, we feel compelled to reach out aggressively to consumers with the message that voice and video communication is here to stay," continued Martin. "Though other companies have talked about marketing videophones, none have taken an active role in promoting the technology to this generation of broadband internet users."

The $99 VideoPhone offer is good while supplies last. In addition to this one-time purchase price, new subscribers will be charged an initial $29.95 activation fee, a $19.95 per month service fee, applicable taxes and a monthly $1.50 regulatory recovery fee, a new fee being introduced on all Packet8 phone numbers effective May 1, 2005.

About 8x8, Inc.
VoIP (voice over internet protocol) service provider 8x8, Inc. offers internet-based telephony solutions (www.packet8.net) for individual residential and business users as well as small to medium sized business organizations. In addition to regular Packet8 VoIP service plans, priced as low as $19.95 per month for unlimited anytime calling to the U.S. and Canada, 8x8 now offers the Packet8 DV 326 VideoPhone, the industry's first stand alone broadband consumer videophone. Packet8 Virtual Office, 8x8's VoIP system for small to medium sized businesses, is a hosted PBX solution comprised of powerful business class features.