Skype rings the changes

News

Tim Green from 3GSM in Barcelona Feb 14 2006, 4:30pm

Skype has joined with 3 to deliver 'free' Voip calls across the mobile network and, as if that wasn't hairy enough news for operators to digest, it is also set to sell major label ringtones.

ME can reveal that Skype is currently in talks with Warner Music to offer official ringtones so that users can personalise Skype caller tunes on their PCs. The company already sells tones, but this is the first deal with a major. Should it take this functionality to mobile - with revenues bypassing the operator and going straight into Skype accounts - alarm bells will ring. Niklas Zennstrom, CEO of Skype, told ME: "We want to sell value added services and music has obvious potential . We have 75m users, so it's an opportunity for music labels to promote their artists too."

For now though, the deal between 3 and Skype is being positioned as only doing good for content. 3 sees Skype as another service to add to its bundle, "providing more choice and accelerating the uptake of 3G services." It insists 'free' Skype calls are a customer acquisition play and one that will expose more new subscribers to 3's multifarious media products.

This may well be true. It has to be, as this deal surely marks the start of the erosion of mobile voice revenues. And with Skype offering 'free' instant messaging, the SMS market isn't immune either.