For all the positive conjecture about Internet telephony, the Web-based service may well incite something close to an identity crisis for Verizon Communications and chief executive, Ivan Seidenberg.

Ironically, however, the company bosts on its website that, “There are so many advantages to using VoiceWing,” the company’s own Internet telephony service. But just Verizon is taking VoIP business very seriously. As of May, 3 it has cut its fee for monthly unlimited calls across the U.S. on VoiceWing by $5, putting it down to $24.95. That’s a price tag which now matches VoIP rival Vonage’s $24.99 a month service.

Jumping on the Internet telephony bandwagon has been a major paradigm shift for traditional telecom firms like Verizon and cable companies like Comcast, and few are believed to have aggressively marketed their VoIP services. For the first quarter, Verizon reported that the total number of its traditional access lines in service fell by 6.9% to 48 million, as customers presumably fled to the cheaper, Internet offerings.

Those “small” online rivals meanwhile, have gone past gnawing and are now pushing the envelope rather aggressively. eBay-owned Skype recently reported that it had reached 100 million subscribers and was releasing a Wi-Fi mobile phone and speakerphone, while Vonage also announced a F1000 portable WiFi handset and raised the amount of cash it expected to raise from its upcoming IPO by an incredible 100%. As for the traditional telecom leaders? For now a price war looks to be afoot, as slashing prices may be the best established telecom giants like Verizon can do to compete with its smaller and increasingly popular rivals.