This is not your father's AT&T (NYSE:T). At least, that's the message Ma Bell executives are trying to peddle. Indeed, with a big push into sexy corporate and consumer Internet-based telephone services, the telecom has a new look. But, as Fools know, you should never buy on looks alone.

AT&T likes to call voice over Internet protocol, or VOIP, a "disruptive" technology. But normally, it's older, entrenched companies like AT&T that tend to be the ones "disrupted" by new technology. Phone calls will get sent over the Web, which at the end of the day means they will be cheaper. But the introduction of a lower-priced VOIP service - dubbed AT&T CalVantage -- will compete with, and cannibalize, the other 95% of sales coming from AT&T's traditional long-distance offerings.

MCI's emergence from bankruptcy later this year will mark the return of AT&T's biggest long-distance competitor. AT&T's plan to aggressively price down in order to maintain its long-distance market share, which will do nothing to stem falling revenues and earnings at the company -- at least, in the near term.

As for bundling mobile phone and local high-speed (DSL) Internet with its long distance, AT&T will have to resell others' services. Following the sales of its cable operations and AT&T Wireless to Cingular, AT&T has no wireless local network assets of its own, which puts the company in a vulnerable position.

For starters, there is a chance that the FCC will allow the Baby Bells, Verizon (NYSE:VZ), and SBC Communications (NYSE:SBC) to increase rates on their networks, jacking up the cost for AT&T to compete in local markets. Even worse, AT&T may have to rely on its old rival, newly consolidated long-distance and wireless operator, Sprint (NYSE:PCS), for mobile service.

Sure, Ma Bell produces enormous cash flow. The dividend is not at risk. AT&T trades at three times EBITDA, well below the five to seven times EBITDA multiples of the Baby Bells. But that discount is deserved. AT&T believes that the industry will consolidate and customers will flock to its long-distance services, but Fools should hesitate to pay a premium for what remains the same old, vulnerable telephone business.

Will AT&T be able to revamp itself and profit on voice over Internet protocol? Or will it be one big bust? Want to find other dividend-paying companies? Check out The Motley Fool's Income Investor . Take a free trial today.

Motley Fool contributor Ben McClure hails from the Great White North. Ben doesn't own any shares mentioned here.