3GSM: VoIP will have no major impact, T-Mobile exec says

Many technical hurdles to overcome, says Hamid Akhavan

 BARCELONA  -- Don't expect new mobile phone services based on the Internet Protocol to become nearly as prevalent as those running over PCs. That's the view of Hamid Akhavan, CEO of T-Mobile International AG, one of Europe's largest mobile phone operators.

Voice-over-IP services provided over mobile phone networks will have "far less impact" than those offered over fixed-line networks, Akhavan said today on the sidelines of a press conference at the 3GSM World Congress in Barcelona.

"There are all sorts of technical issues that make mobile VoIP services difficult to implement," Akhavan said. However, technical issues related to how networks pass on the IP addresses of mobile users have not been completely resolved, he noted. "Take reachability, for example: How can the call come to me?"

Akhavan said emergency phone service and "always on" connectivity are also big issues, since staying online takes up bandwidth on pricey mobile networks.

And then there's the cost. "When people talk about VoIP, they think free," Akhavan said. "With any mobile service provided over the Internet, you're going to need to buy a data package."

Mobile VoIP "will take a small share" of revenue generated by mobile voice services, he said.

Akhavan's views on the technical and commercial hurdles are even shared by at least one of  the key advocates of mobile VoIP -- Skype Ltd.

In a recent interview with a Finnish newspaper, Skype co-founder and CEO Niklas Zennström spoke of "technical obstacles" and conceded that efforts to make Skype work have been taking "much longer than expected."

Earlier, Eric Lagier, Skype's director of business development for hardware and mobile, called the lack of attractive flat-rate fees for most mobile phone services a key commercial hurdle to mobile VoIP usage. He said the company didn't want to be in a position of claiming that its service is free while facing users who at the end of the month are docked with a huge broadband usage fee.

At last year's 3GSM World Congress, Skype and Hutchison 3G (known as 3) announced a partnership to provide what they had hoped would become the world's first commercial VoIP service for mobile phones.

3, which operates IP-based mobile broadband networks in several European markets, was one of the first mobile phone operators to embrace VoIP, a technology many in the industry view as a major threat to their cash-cow voice business.

Copyright © 2007 IDG Communications, Inc.

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