Nokia, Motorola Show Cellular-VoIP Phones

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Nokia, Motorola Show Cellular-VoIP Phones
By LAURENCE FROST AP Business Writer
© 2006 The Associated Press

BARCELONA, Spain — "Call me back on the landline" may soon sound like a quaint, turn-of-the-century instruction to the ears of many mobile phone users.


Nokia Corp. and Motorola Inc., the world's biggest branded handset makers, both unveiled phones this week that switch between cellular coverage outdoors and cheap wireless Internet calls inside _ all on a single phone number.

The new hardware is a response to growing demand. Mobile networks, aware that they can't beat Internet call operators like Skype for cheap indoor coverage, are itching to join them.

BT Group PLC already has. In September, the British telecom began shipping Motorola handsets to the first customers of its BT Fusion service, the first in the world to allow users to switch in mid-call between cellular and Voice over Internet Protocol, or VoIP _ delivered via a Bluetooth connection at home.

The new Nokia 6136 and Motorola A910 handsets, like a handful of others announced by smaller manufacturers in recent months, can connect to the Internet via WiFi, rather than Bluetooth, to make cut-price calls from the home, office or public hotspot.

"Then you walk out of the door and the call is seamlessly handed off to the cellular network," said Nokia Executive Vice President Kai Oistamo. "There are no dropped calls _ it's like moving from one cell to another one in a cellular network today."

Other mobile operators have waited for the WiFi phones before adopting the technology that enables the mid-call switching between broadband and cellular networks, called Unlicensed Mobile Access.

France Telecom SA will be its first customer for Nokia's UMA phone, to be sold under the French operator's Orange brand to customers of its LiveBox _ a phone, TV and Internet hub marketed in France, Britain, the Netherlands, Spain, Poland and Belgium.

Several other operators have announced trials or launches of UMA products.

The move into "converged" cellular and VoIP services is a big step for the mobile industry, which often sees the Internet as a threat to future revenues from 3G services it has spent years _ and billions _ developing.

But proponents say it's a necessary step to stem a potential exodus to Skype. About 15 percent of the world's 191 million broadband Internet subscribers used VoIP in 2005, according to Informa Telecoms and Media _ a threefold increase on the previous year.

Broadband hardware maker NetGear Inc. and others showcased a slew of new WiFi-only phones designed to work with Skype and other VoIP services at last month's International Consumer Electronics Show in the United States.

"The advantage of UMA for an operator is that they can get to maintain control of their customers," said Steve Shaw, marketing director for U.S.-based Kineto Wireless, one of the technology's pioneers.

Kineto offers off-the-shelf UMA client technology to handset makers in partnership with chip makers TTPCom and Infineon. Together with Cisco Systems, it demonstrated WiFi UMA calls at the Barcelona trade show.

UMA promises to reduce networks' costs by transferring traffic to cheaper broadband infrastructure while improving the quality of the 3G services for indoor users _ since high-speed cellular connections are notoriously bad inside many buildings.

It also offers new revenue sources to operators, who will be able to charge more for their Internet calls than the likes of Skype, Shaw believes, in return for the convenience of the seamless switch-over and single-number accessibility.

Orange spokeswoman Caroline Ponsi declined to give details of the company's pricing plans for the service.

BT Fusion bills an Internet call to an ordinary landline at about 3 pence (4 euro cents; 5 U.S. cents) per minute in peak hours on top of the basic monthly subscription charge of 9.99 pounds (euro14.59; US$17.37).

The service so far has about 13,000 subscribers and is attracting about 2,000 new customers each month. A BT spokesman said Fusion is not marketed as a VoIP service and is not in direct competition with Skype.

"With a Skype phone you can't just walk out of your house and maintain your call," Giles Deards said. "It's the wrong comparison to make."