Wireless VoIP Cuts Cellular Bills – For Now
Turning Mobile Voice into Data, One Phone at a Time

April 8, 2010 (Vol. 31, No. 7)

Recent developments concerning wireless VoIP can help reduce your mobile voice costs, particularly when it comes to those reviled international roaming and long-distance fees. Still, the industry has a way to go before businesses can fully leverage wireless VoIP to their economic advantage.

There are two reasons. First, operator and handset maker initiatives to put voice into IP packets and send them across today’s 3G networks inexpensively or for free are happening in dribs and drabs. So enterprises face a complicated integration puzzle in deploying wireless VoIP. Certain IP telephony applications work only on certain devices, for example. From there, certain devices work only on certain networks. Piecing it all together enterprise-wide is not for the faint of heart.

Second, when VoIP over wireless becomes the de facto method for making mobile phone calls, the operators’ pricing plans likely will have been overhauled to reflect not minutes of usage but megabytes consumed. What will those prices be? That’s a great big question mark. We can only hope that voice doesn’t end up costing us more when all-IP 4G networks are the norm. It shouldn’t, because it will be cheaper to deliver. But that’s no guarantee.

In the meantime, some recent wireless VoIP developments are worth examining for ways your users can use VoIP clients on their handhelds today to save money. For larger-scale cost benefits, wireless VoIP can also be deployed in conjunction with special PBX gateways or routers that you operate in your own data center.

Let’s take a look.

Status Report: Carriers Relax Rules

The number of worldwide mobile VoIP users will hit 288 million by the end of 2013, estimates Scottsdale, Ariz.-based market research firm In-Stat. One usage driver is the relaxation of some of the carriers’ rigid rules that once banned VoIP traffic from their packet-switched mobile networks.

For example, AT&T now allows VoIP over its cellular data network. And AT&T’s partner, Apple, opened up its software development kit (SDK) to enable 3G voice apps to be built for the iPhone.

VoIP restrictions were once staples of all the mobile carriers’ 3G data network terms and conditions. The bans had been in effect primarily to protect the mobile operators’ circuit-switched cellular voice revenues, so it’s fundamentally good news that those restrictions are being lifted.

But Skype Still Relegated to Wi-Fi on AT&T

There are some gotchas, though. For example, what devices are your employees using? If they have iPhones, there are telephony apps from companies such as iCall and Fring that can make 3G VoIP calls.

But Skype IP telephony client software, which is one of the most widely used applications for bypassing traditional voice toll charges, doesn’t exist yet for making iPhone calls over AT&T’s 3G network. The Skype for iPhone application still requires you to use Wi-Fi to place wireless calls. That’s fine, as long as there’s a Wi-Fi network available and users without a monthly Wi-Fi hotspot subscription don’t mind logging in and paying by credit card.

Instead, Skype began offering on March 25 a 3G VoIP client for Verizon Wireless’s network [VR 2/25/10]. It’s aimed to help users save primarily on international calls: international Skype-to-Skype calls are free, while U.S. Skype calls to international non-Skype destinations are billed at SkypeOut charges. (SkypeOut charges apply when the calling party is on Skype but the called party is either on a traditional landline or a mobile network device without Skype software.)

The Verizon Wireless Skype application works on the BlackBerry Storm 9530, Storm2 9550, Curve 8330, Curve 8530, 8830 World Edition and Tour 9630 smart phones, as well as Droid by Motorola, Droid Eris by HTC and the Motorola Devour. Verizon Wireless has said it intends to support more phones and platforms later this year.

What’s the Motivation for 3G Mobile VoIP?

Why use VoIP over 3G? With the Skype for Verizon Wireless plan, Skype calls don’t count against a user’s cellular minutes allowance or pooled plan. So it helps keep your user pool from exceeding its monthly minutes limit, perhaps helping avoid some overage charges.

But subscribers are still required to have both a voice and data plan, making the potential savings murkier. Savings will require some calculation on your part, given that mobile-to-mobile calls on a single carrier’s network already tend to be free.

Again, domestic-to-international calling is probably the savings sweet spot here, where you can get SkypeOut prices from two cents per minute and up. (See chart in this month’s WorkTool)

Most likely, the carriers’ strategy is to slowly but surely lower the barrier against VoIP over 3G to pave the way for the day, in the not-too-distant future, when mobile operators decommission their circuit-switched networks and all voice calls traverse the mobile operators’ 4G IP networks. They need to get mobile users hooked on data applications and the requisite data network subscriptions that go with them before they can retire their circuit-switched voice cash cows.

Money-Saving CPE Options

If you want to control your mobile costs from your premises – rather than rely on a carrier or phone maker – there are some new options.

For example, Agito Networks, which makes CPE called the RoamAnywhere Mobility Router and associated software for user handhelds, recently addressed the issue of international roaming charges by building support for VoIP over 3G into its devices.

Traditionally, Agito’s mobility router – which integrates with PBXs – handed off voice calls between the circuit-switched cellular voice network and Wi-Fi, depending on user location, for least-cost routing.

Agito has decided users might frequently be in situations with no Wi-Fi coverage but a 3G network service available (for example, in a taxi). So enterprises using Agito’s Mobility Router can now make and receive VoIP calls over 3G networks.

This can save money because the carriers currently offer $20 unlimited international data plans, explains Pej Roshan, Agito founder. So all international calling, for now anyway, would be included in that flat monthly fee. Roshan adds that he doesn’t necessarily expect customers to use the feature in the domestic United States where unlimited voice calling plans are available.

Also available for trial is a Skype for SIP Open Beta program, which requires a SIP-enabled IP PBX. You set up an account for your organization, and your IP PBX calls are directed to the Skype network to save money both on landline and mobile calls all over the world.

If you don’t have a SIP-enabled IP PBX, you can use the VoSKY SSG, a gateway announced in March for small and mid-sized businesses, to connect legacy PBXs and key systems to Skype for calls at Skype rates.

But does it make sense for enterprises to organize their communications around Skype or similar applications such as Google Voice – a free, browser-based call forwarding service that rings multiple phone numbers associated with a given user?, poses wireless expert Michael Finneran, principal at dBrn Associates, in Hewlett Neck, N.Y.

The enterprise impact of these alternatives depends on ease of deployment and the user interface. “If it’s a pain in the ass, people aren’t going to do it,” he says. (

Joanie Wexler has spent a good part of her 20-year telecommunications career helping enterprises adapt to changing wireless networks and mobile devices. She has chronicled the cellular evolution from the days when 19.2 Kbps was the fastest data rate going and early personal communicators, like the Apple Newton and HP Palmtop, were paving the way for today's broadband wireless networks and smart phones. Today she continues to stay on the pulse of the wireless technology market as one of its leading independent authorities. Contact Joanie at joanie@jwexler.com.