The launch of the Skypephone by mobile operator 3 looks set to change the way the mobile telecoms industry looks at VoIP. So far its attitude has been less than friendly, as evidenced by reports not long ago of mobile operators only allowing a VoIP-enabled device onto their networks after it had been knobbled so that users couldn’t access the service.
The device in question was Nokia’s N95 smartphone. Now some operators looked at this VoIP-friendly handset and took an instant disliking. They decided their business models couldn’t handle voice revenues being nibbled at, so using a firmware scalpel they performed a bypass operation. When people objected the operators made a big noise about the quality of the VoIP service not being up to their exacting standards, but essentially they had concluded: cheap mobile VoIP calls over their network equals bad; revenue-earning mobile calls over their network equals good.
3 has put the boot into that model in an attempt to entice subscribers to its network and 3 says it will be trying for both pre-pay and contract customers. Subscribers need to spend £45 for a single Skypephone, or £89 for a pair, and then spend at least £10 a month topping it up. If we assume that call quality is OK and 3 says that Skype calls are carried over its network as standard 3G voice calls and then carried over the internet to other Skype users then the future looks bright for 3 and maybe not for Orange et al.
Then again, maybe not. I recently had a natter with the chief technologist at high-performance networking specialist Ciena, John-Paul Hemingway, about how mobile operators are having problems with backhaul, and it got me thinking about how 3 would cope with the increase in traffic that would occur if Skypephones started to fly off the shelves. Does 3’s high-speed 3G network have the spare capacity to provide the necessary backhaul to service that increase in traffic? Well, 3 says yes, and I would have thought that you don’t sign on the bottom line of a deal like this without having first done some serious research, a smattering of in-depth modelling and a fair dollop of painstaking testing, so I guess its confidence is well founded.
But Ovum analyst John Delany highlights what could be another problem for 3. He said that while the Skypephone will boost 3’s subscriber numbers, the raft of free services available over the internet, such as Google, Hotmail and YouTube, could move 3’s business towards “subsidising phones, carrying data packets, and dealing with problems and complaints”. Does that add up to an attractive business, he wonders.
