The advent of Skype on Apple’s iPhone could be a watershed moment for internet phone calls. It brings together the biggest name in smartphones and the biggest name in voice over internet protocol (VOIP) calls in a partnership that threatens to undermine the business model of mobile phone carriers.

VOIP handles calls as data and routes them over the internet rather than a traditional phone network. By using wi-fi internet links, as opposed to mobile-phone networks, mobile customers can avoid being charged for the calls by wireless-service providers, such as AT&T or O2.

Skype has built itself a solid reputation as a provider of free or cheap calls over the internet from desktop computers and has had notable success in the field of international calls. In 2008, Skype users spent 33 billion minutes talking to people in other countries, representing 8 per cent of international voice traffic, according to TeleGeography Research, making it the world’s premier provider of cross-border voice communications.

From this base, the company, bought by eBay in 2005 for $2.6 billion, wants to grab a large slice of the huge mobile phone call market.

However, instant success for Skype on the iPhone is not guaranteed. For now, users will not be able to make Skype phone calls using a 3G network, restricting its use significantly to home wi-fi networks and public hotspots. This restriction, and the fact that users have to have the iPhone Skype application running to receive Skype calls – which will shorten the already unsatisfactory battery life – will blunt the impact of the Skype/iPhone partnership.

But in the medium term, VOIP calls for mobile phones will become widespread and popular and mobile operators will have to work out how best to adapt.

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