Software delivers 'free' calls on the net

Steve Simms, from Reach Wireless, can make calls from a growing number of wireless "hot spots" around New Zealand. Picture / Richard Robinson

Internet peer-to-peer file sharing, often associated with illegal swapping of music and movies, could get an image reprieve by enabling free voice calls to be made anywhere in the world, legally.

Skype is a file-sharing system that enables free calls between computers at no extra cost beyond that of internet connection.

The number of downloads of the freeware from the Skype website is more than 87 million, although many of those will be updates.

The software can be used with a headset and built-in PC microphone or a special phone handset can be plugged directly into the computer.

Calls can also be made to land-line or mobile telephone numbers anywhere in the world via a service called SkypeOut, and always at local rates.

A SkypeOut call to Britain, for example, would cost $0.032 a minute.

Steve Simms, general manager of Auckland wireless internet provider Reach Wireless, said a year after learning of Skype he is using it for 20 per cent of his calls.

He uses it primarily for communicating with staff and suppliers, no longer having to concern himself with call costs.

But Simms is not just limited to using Skype at his desk. He can make calls from one of the growing number of wireless "hot spots" appearing around New Zealand.

The number of such sites, where users can access the internet without a telephone line, has more than doubled in the past year to about 500, from a number of providers.

Simms said although Skype was not yet threatening to replace mobile and land-lines, it will become a competitor for businesses and those with large contact networks.

"If I were a telco would I be scared about my revenue eroding out of this thing? Absolutely."

Simms said the speed and flexibility of Skype saved his bacon when a key network server broke down. Getting it fixed quickly was crucial.

Using traditional calls to co-ordinate an engineer, the call centre and suppliers could have taken hours. "I managed to do that so quickly on Skype through a four-way conference call that actions were happening left, right and centre."

Simms is a walking promotion for Skype, directing everyone he knows to the website from where the software can be downloaded.

His only concern is what could happen as its popularity grows.

"The thing that would kill this particular service would be if the internet operators suddenly slowed down the port that Skype works on."

That's an outcome Telecom head of internet and broadband services, Chris Thompson, said was not on the cards. "From a bandwidth point of view that's not so likely because most of the problems around peer-to-peer applications ... are around people trading really big files like movies, software or music."

Voice, by comparison, is a relatively small data stream.

Telecom counted 40,000 Skype users in New Zealand last month.

"We think it's generally a good thing for encouraging more people to use the internet," Thompson said.

He doesn't view Skype as a serious threat to the quality of more established telephone call systems.

Skype's biggest limitation was the need for continuity of bandwidth.

"If your email is 20 seconds late you don't mind. If there's a 20-second break in your phone call, it's not a great conversation."

Telecom could not guarantee the quality of service users of Skype may expect.

"It's like a motorway. It's a great thing, you can drive your car anywhere you like but sometimes there's a lot of other cars ... and you can't get through."



Skype hype

Skype's free software allows voice calls to be made over the internet via a PC.

Calls can be made free between Skype software users and for a small fee to ordinary phone numbers.

In February Telecom estimated there were 40,000 New Zealand Skype users.