Motorola launches Skype alliance
Published: 15 Feb 2005 09:50 GMT
Motorola said on Monday that it is developing mobile phones capable of making calls using Wi-Fi networks, a big step for Internet phone forces now eyeing the wireless industry.
The world's Number three handset maker plans to add Internet phone software from Internet telephony provider Skype to a select number of Motorola phones that can link to the Internet using Wi-Fi.
With the phones, it'll be possible for Skype customers to call each other -- at no additional cost, in most instances.
Because the phones would steer calls away from mobile phone networks, combination cell and voice-over-IP phones could have a profound impact on the telecoms industry.
VoIP calls, connecting via a Wi-Fi network to a home broadband connection, can be made for free or at prices much lower than a mobile phone call. But when on mobile phones, they raise a serious question: Why would a mobile phone service provider want to sell or host such a service that has the potential to eat into its own revenue?
As one expert put it Monday, "cannibalism happens" in the telephone industry. Also, wireless operators see VoIP as an opportunity to take business away from the local fixed-line competition.
"Skype is natural fit," said Liz Altman, vice-president of business development for Motorola mobile devices.
Hue and cry over Wi-Fi
Interest in combination cell and VoIP phones is growing from handset makers and operators, according to executives attending the 3GSM World Congress in Cannes. The huge wireless trade show, at which the Skype-Motorola deal was announced, began on Monday.
"We're getting a lot of requests to supply handset makers with the relevant software. Nokia is very, very big on this," said David Rivas, chief technology officer of Sun's mobility unit. A version of Sun's download software is now on more than half the world's mobile phones. A Nokia representative had no immediate comment.
But there are several obstacles to cramming VoIP onto mobile phones that handset and network equipment makers have yet to overcome.
Most have to do with Wi-Fi phones. For example, most operators haven't found a way to adequately switch between the two wireless protocols, keep track of the calls for billing purposes or keep a phone from draining its battery too quickly. There are thousands of Wi-Fi networks nationwide -- but only a fraction of what's needed for nationwide coverage.
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