Using WiFi to make Cell Phone calls
July 30th, 2006

The New York Times addressed a development in cell phone technology to use Wireless Networks to make Voice over IP Phone calls instead of the Cell Phone’s particular Cellular Network. The problem is … if we start using Wireless to make calls while at any hotspot (and there are more hotspots all the time) how’s the cell phone company going to make any money?

On its face, the technology would seem to present the carriers with a major problem. The more time subscribers spend connected to Wi-Fi hotspots, the less time and money they spend on the cell network.

The phones, while a potential money-saver for consumers, could cause big problems for cellphone companies. They have invested billions in their nationwide networks of cell towers, and they could find that customers are bypassing them in favor of Wi-Fi connections. The struggling Bell operating companies could also suffer if the new phones accelerate the trend toward cheap Internet-based calling, reducing the need for a standard phone line in homes with wireless networks.

But what happens if someone produces just a WiFi phone that you’d use either at home or at an internet cafe or some other location where there is wireless? I mean, if I had a my phones at home also connecting into the wireless network, for the most part – I would not need phone service (but right now I still do).

Skype, the Internet calling service owned by eBay, said last week that four manufacturers plan to begin shipping Wi-Fi phones that are compatible with the service by the end of September. Among them is Netgear, a maker of networking equipment, which plans to charge $300 for its phone; the other makers include Belkin, Edge-Core and SMC.

That’s pretty interesting as I have a SKYPE account and if there was a phone I could carry with me or just leave at home – I’d probably use SKYPE a lot more that I do now (I’ve only used it a couple of times and every time I make or receive a call I need to pull my headset out to hear the call as well as speak – so it’s still not feeling natural to me.

Later this year, T-Mobile plans to test a service that will allow its subscribers to switch seamlessly between connections to cellular towers and Wi-Fi hotspots, including those in homes and the more than 7,000 it controls in Starbucks outlets, airports and other locations, according to analysts with knowledge of the plans. The company hopes that moving mobile phone traffic off its network will allow it to offer cheaper service and steal customers from cell competitors and landline phone companies like AT&T.

Ha!! I’m a TMobile customer and TMobile people I have spoken to have suggested a major annoucement is coming in Novemeber – I wonder if this is part of that announcement – it had to do with home networking but at this time they are not allowed to discuss it.

Later this year, T-Mobile plans to test a service that will allow its subscribers to switch seamlessly between connections to cellular towers and Wi-Fi hotspots, including those in homes and the more than 7,000 it controls in Starbucks outlets, airports and other locations, according to analysts with knowledge of the plans. The company hopes that moving mobile phone traffic off its network will allow it to offer cheaper service and steal customers from cell competitors and landline phone companies like AT&T.

We covered this at SmartMobs – in fact, it was I who reported on the FON deal – here.


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