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Is Skype the Escape from Cell Phone Fees?

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Contributor:
David Silversmith
David Silversmith

This week's announcement that  a Skype application for the iPhone will appear in the Apple App Store on Tuesday will begin to change the costs of iPhones. The Skype application will enable you to make cheap VoIP calls over Wi-Fi and it works on both the iPhone and iPod Touch. Showing who is wearing the pants in the Skype (eBay) and iPhone relationship, the application will feature iPhoneish and not Skypeish menus.

Every iPhone user I have talked with loves their iPhone. But, other than the ultra-wealthy (and in this economy that list seems to be dwindling every day) they also lament the cost of the iPhone service. Whether it is Vodafone or AT&T, the fees for iPhone service are steep.

The Skype application will have features like taking a photo from within the application, using photos as your avatar image and sorting your contacts alphabetically or by online status. However, there are also a number of features that are missing or limited in this initial version. There’s no support for SMS, no support for  file transfer, no call-waiting support for handling second incoming Skype calls and while you can join a conference call your Skype phone cannot be the conference call creator.

The Skype pricing model on the iPhone will mimic the desktop. The Skype iPhone application will be free to download just as it is for the desktop. Skype will allow free calls between Skype users, regardless as to whether the Skype user you are calling is on a mobile phone or their desktop the call is free. But, and this is the big but, as with Skype on the desktop fees will be charged for calls to traditional phones. 

Skype won't change the cost of the iPhone or the basic cost of the Vodafone service. But it could be great news for anyone who's been bumping up against their plan's minutes but doesn't want to suffer overages or up their monthly bill. However, any cost savings that you see will depend on how many of the people you call are using Skype. A big boost for this universe will come in May when a Skype client for the Blackberry will become available.

Before you rejoice over the fees, realize that there is a reason that the carriers are not fighting this introduction.  Mobile Skype has has been available for some time in a few countries such as the United Kingdom and the 3UK network reports that Skype has led to a reduction in roaming fees for many of its customers. However, they also note that Skype has shown that it can boost consumer spending on cell phones as it encourages use of the phones for other data services.

So take that as a warning if you add Skype.  Use it to save on overage and roaming fees, but beware the slide into using the iPhone for more data services and bumping your bills right back up!

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