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EDN Europe's Editor Graham Prophet posts a selection of comments and insights prompted by the many items of industry news and rumour that cross the editorial desk or are gathered on his frequent travels to interviews, press conferences and events around Europe - and further afield - and somehow never find their way to the magazine or the web site, recovering some of the information otherwise lost in the noise level...

Monday, October 29, 2007

Free Skype calls on 3 mobiles - what's the deal?

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The cellphone network Three has announced that it has done a deal to offer Skype calling on one of its branded phones. “Free mobile calls” is the hook. There are, as you might expect, limits. You must have a Three contract or pay-per-call SIM, and the calls are only to other Skype users, called by Skype name. Skypeout calls – calls routed out of IP into the telephone network and addressed by number – are not supported. Obviously.

Hutchison has had its problems with the Three brand; it announced very early (you might remember – to hit the date 03/03/03), then took a while to get handsets into the market, and then had the problem of having a lot of bandwidth to sell but not much in the way of added-value services to use it up. So why is it now giving away calls for free?

As Three is a 3-G network, we must presume it is using the WCDMA route to internet. You can already buy phones with WiFi that will run Skype (or another VoIP application) (if you load it yourself) and soon there will be more. We can speculate that as well as being an attention-grabber (“Free Calls!”) it’s an attempt to divert users from going down that route – as well as to bring a different group of users into the company’s customer base, who will then use their phones for other, revenue-earning calls.

Cellular-service futurologists have suggested that we might soon have a phone that would look at your call and offer you the cheapest route – via your cellular account on GSM or WCDMA, or by paying for WiFi access then routing the call for free over IP.

The Three announcement, not that there is anything wrong with it, takes us further away from that scenario rather than bringing it closer, by taking control of at least some VoIP calling. As long as the majority of cellphones – as they are in Europe – are supplied branded by the networks, the chances of them obligingly seeking out the cheapest call routing are very slight. VoIP as a loss-leader is new twist, though, and it will be interesting to see how that works out.

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