TELECOM Digest OnLine - Sorted: Start-Up Slashes Cost of International wireless

Start-Up Slashes Cost of International wireless

Monty Solomon (
Sun, 14 Aug 2005 01:45:52 -0400

Cambridge firm uses Skype technology to make cellphone calls
By Peter J. Howe, Globe Staff | August 1, 2005

CAMBRIDGE -- In just one year, computer users around the world have
downloaded 140 million copies of the Skype program that lets them make
free phone calls over the Internet to other Skype users.

Now a Kendall Square start-up is pushing Skype into a new frontier:
cellphones. Through a $10-a-year software rental that goes on sale
today, iSkoot promises to let people make international calls to other
Skype users for nothing more than the price of local air time for the
link from their cellphones to their broadband-connected home

Just as Internet phone technology has slashed the price of making
conventional landline long-distance calls and enabled unlimited
calling for as little as $20 a month, the iSkoot technology could put
pressure on still-exorbitant wireless international calling charges.

Cingular Wireless and Verizon Wireless, the two biggest US carriers,
charge $1.49 a minute for calls to Europe and India, and rates as high
as $3 for less common destinations like Madagascar. Subscribers
willing to pay a $4 monthly fee can get lower rates, such as 19 or 20
cents a minute to most of Europe and 30 or 35 cents to India. But
Verizon warns it can require a $500 security deposit for international
long-distance subscribers.

Market data suggest a big market for international cellphone calls.
According to a survey by Telegeography, a market analysis and research
firm in San Diego, 20 percent of all international calls originated on
cellphones in 2003, the most recent year surveyed. In the United
States and Canada, the figure was 5 percent.

The iSkoot founder, Jacob Guedalia, said his vision was to 'enable
the individual to become his own long-distance carrier' by routing
calls over a home or office computer connection, instead of AT&T or
Sprint. Thanks to moves by Skype to make its software code available
to other technology developers to build new services and products that
run over Skype, Guedalia said, "We can take the voice-over-Internet
revolution, which until now has really been confined to the personal
computer, and bring it to the mobile world."

Executives at top wireless carriers, who could lose millions of
dollars in international calling revenue, are taking a wait-and-see
attitude. Although carriers like Verizon and Cingular maintain wide
latitude to terminate customers they deem to be misusing their service
by doing things like making excessive free night and weekend calls,
functionally iSkoot resembles using a calling card or company
conference bridge for an international cellphone call, which normally
carriers don't block.

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