Skype, a way of making voice calls using the Internet instead of telephones, is currently free. It is also easy to use, requiring only the purchase of a headset.

Skype looks very promising. But Skype is still a long ways from being practical for making ALL your phone calls.

Skype is growing at a stunning pace — nearly 7 million users since the company started last fall. That's explosive growth --consider that when TDavid reported about Skype here on Blogcritics on September 22, 2003, there were only 635,000 downloads of the Skype software.

Skype, a Scandinavian company, is by the same people who developed KaZaA, the music filesharing application. Skype is a "peer to peer" voice application. All you do is go to the Skype website, download the Skype software to your Windows 2000 or XP computer, plug in your headset, and call up another person.

The catch is that right now the other person also has to have the Skype software. And, since there is no Skype phone book or directory assistance, it is up to you to know how to reach the other person.

Skype claims to be different from other Voice over Internet Protocol (VoIP) applications. In addition to being simpler to use, the website says that Skype works behind most firewalls whereas most VoIP solutions do not work behind broadband connections due to firewalls.

Early reports rave about Skype's clear reception and ease of use.

One of Skype's founders, Niklas Zennstrom, stated last week on CNBC TV's Closing Bell that Skype is entering into agreements with major telecommunications providers to enable Skype users to communicate with regular telephone customers. No word was given on when that service would become widely available, other than it's coming soon. (Meanwhile, the telecommunications analyst on the show opined that the telecommunications industry was in deep trouble due to competition from VoIP solutions such as Skype.)

Until you can use Skype to call anyone with a standard telephone, Skype's usefulness is going to be limited. Skype right now sounds like a great solution if there is someone you call frequently, and the two of you get set up on Skype ahead of time, and share your "callto:" information.

But don't think about picking up your headset and just calling someone out of the blue. It's not that simple yet.

It looks clear that VoIP solutions (maybe including Skype) will eventually overtake and replace regular telephone systems. But we're not there yet. Skype is still very much in the experimental stage.

Meanwhile, if you want to call one of those millions of people worldwide already using Skype, look for this button in their emails or on their weblogs or websites.

NOTE: This post was adapted from a previous post appearing on the author's weblog, Small Business Trends.