The PC application Skype is not a good choice for businesses due to its poor call quality, an expert has said.

Colin Duffy chief executive of Voipfone conceded that Skype is "wonderful application which has changed an awful lot of the telephone industry" but is "rubbish" for businesses.

He also said that the application can slow down a system by using it for other people's call - if Skype detects that there is quite a lot of bandwidth available it'll start routing other people's calls over users' network which slows down their whole network.

"Businesses don't want to only be able to answer their phones when their PCs are switched on and they want to have their telephony separate from everything else," Mr Duffy commented.

According to Ofcom's annual Communications Market Report 2007, consumers are increasingly using telephone services over the internet offered by VoIP providers.

Research conducted by Ofcom in 2006 also indicates that around 60 per cent of the adult population are aware of VoIP services in the UK.