Using the single most effective word in retailing in its name, FreeCalls365, based in Southern California, launched its advertising-based voice-over-IP business this week.

FreeCalls365.com will provide free local and long distance calls from any computer to any phone, anywhere, anytime.

It promises clear, high-quality audio with undetectable white noise or interference and offers an easy-to-use desktop dialer similar in size to a Blackberry or PDA.

The dialer contains the advertising, which pays for the cost of service. The new service provider is partnering with AdCalls for the desktop dialer and advertising mechanisms. It loads when users register on the FreeCalls365 Web site (www.FreeCalls 365.com).

The most notable advertising-based VoIP provider today is Skype, however, Skype charges for call that are off-net, or in other words, to non-subscribers of Skype service. Other companies have tried and struggled with this model including DialPad and Net2Phone, but with offerings from Google, Yahoo!, AOL and others on the horizon, the model may be here to stay.

However, research firms such as EMarketer think online advertising has peaked. The firm said last year that it expects online advertising growth to slow down through 2009. The good news for these ad-based companies is that despite the projected decline, online ad spending is expected to increase by 21.2% this year and still by 10.4% in 2009 to $22.3 billion. .