Skype GSM/Wi-Fi phones 'due this year'

Hot on the heels of announcing new Wi-Fi devices, Skype has revealed plans for dual-mode GSM/Wi-Fi phones by the end of the year, but will the operators play along?

Dual-mode phones designed around Skype will probably hit the market by the end of the year, a senior representative of the company has revealed.

Speaking to ZDNet UK on Friday, Skype's UK manager Alistair Shrimpton said the Internet telephony giant was "currently working with all the major hardware companies such as Motorola and Nokia" to develop GSM/Wi-Fi devices with embedded Skype.

"We're also working with all the major software companies such as Symbian," Shrimpton added.

He conceded that Skype's new Wi-Fi-only handsets, manufactured by Belkin, Edge-Core, Netgear and SMC and announced on Thursday, were "very much aimed at the early adopter" and "still quite an expensive product".

"I think this is really, for us and for the manufacturers, the first step towards producing dual-purpose mobile phones with embedded Skype, offering a Wi-Fi experience in addition to mobile calls," Shrimpton said.

He added that the "drive for 2006" had been to "see what we can do to give people the flexibility to use Skype on [devices other than the desktop]".

Like the Wi-Fi-only handsets launched this week, these upcoming dual-mode phones would allow a user to make telephone calls over Skype when they can connect to a wireless network. The key breakthrough is that they could also connect to a mobile network at other times.

And, drawing a distinction between existing Wi-Fi-enabled phones, which can use a soft Skype client, and phones designed around Skype, Shrimpton said the latter would "undoubtedly give a more seamless user experience".

It remains to be seen whether the dedicated GSM/Wi-Fi Skype phones will be released SIM-free or through agreements with mobile operators.

Shrimpton told ZDNet UK the devices "could work with a SIM-free option but could also work with an operator… we will measure any opportunity according to the value it could bring us".

"Every mobile operator realises that technology such as Skype is extraordinarily disruptive for their market, and obviously the large incumbents and mobile companies want to protect their revenue for as long as they can," Shrimpton added.

However, he suggested it would be "the challengers, the number 3s and 4s" in any market who "might take a stab at being the first companies to move into this area and being the disruptive force".

This might have been a reference to mobile network 3, who at the end of this year will launch a "specific Skype service" allowing users to call other Skype users for free through their 3 handsets. However, 3's service will be based through its 3G handsets rather than Wi-Fi, and will probably involve a monthly charge for the service.

"Most of the big European mobile operators are currently talking with us about our plans. There isn't a single one we haven't had conversations with, but for some of them, probably the last thing they'd like to do is to work with us," said Shrimpton.

"Traditional ways of capitalising on the mobile market are going to have to dramatically change," he added.