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Mobile VoIP cuts free from Wi-Fi

By Peter Judge
May 27, 2008 12:00 PM ET - Mobile voice-over-IP (VoIP) provider Truphone is extending its service to give users free or cheap calls over the cellular network, when they are away from Wi-Fi hot spots. Meanwhile, a rival consumer service has launched with backing from U.K. retailer Tesco.

Truphone Anywhere dials a gateway on a local number, which then connects through to the destination number, saving money if it is an international call. Unlike some other services, this is transparent, with the call setup handled automatically after the user dials the remote number. It is partly enabled by a recent Truphone acquisition, SIM4travel Ltd., which provides cheap international calling through gateways in Europe.

"We've put together our mobile numbers and interconnect, with SIM4travel's home location register," said James Tagg, CEO of Truphone. The company has its own number range, which has enabled it to act as a mobile operator, and win against operators, including T-Mobile, which challenged this. In April, it raised another $33.6 million in venture funding to add to about $25 million, which it raised in 2007.

The idea of mobile VoIP is gaining ground in the U.K., with Australian operator Freshtel Pty. Ltd. launching a trial backed by a Tesco, and with a "buy one get one free" offer. Freshtel uses a VoIP client similar to the one that Truphone is installing on Nokia E and N series phones, and operates on any Wi-Fi.

New Freshtel subscribers get about a $4 credit for a text, which costs about $2, in a limited beta-test deal, launched at the Wireless 08 show in London. The text starts an installation process that -- in Freshtel's demo to Techworld at the conference -- was quick and painless, needing no Web registration. The company claimed benefits compared with Truphone, including the use of the subscriber's regular mobile number.

"We're using other brands to access their customer base," said Rhonda O'Donnell, CEO of Freshtel, explaining the tie-up with Tesco, which owns around 10% of the company.

Truphone's Tagg said that Freshtel was behind Truphone, in that it does not save money on incoming regular calls and does not work away from Wi-Fi.

Both services are likely to go for a higher profile -- with Freshtel hoping for more direct promotion by Tesco after this trial, and Truphone hovering on the verge of services that could put it on a more even footing with regular operators -- for instance, perhaps, offering its own SIM.

Reprinted with permission from Copyright 2012 IDG, all rights reserved.
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