Microsoft to Acquire Teleo, an Internet Phone Company

CHRIS OAKES - New York Times: "Microsoft is expected to announce today that it is acquiring a San Francisco-based Internet phone company, Teleo, to add features to its MSN Internet portal service.

The announcement follows moves last week by Google and Skype, a Luxembourg-based Internet voice company, to take business away from traditional phone companies. Competition for digital calling - from technology companies like these as well as from big cable television and satellite firms - could make prices more attractive to many consumers who have shied away from so-called voice-over-Internet protocol, or VoIP, service.

The Teleo acquisition would give Microsoft a lift in what is at least a three-way race with Google and Skype, but also includes competition from telecommunications companies like the BT Group of Britain and the Internet portal Yahoo. "