Vonage offers iPhone, BlackBerry app for making Internet calls

Plans could be challenge to wireless carriers

Vonage Holdings Corp. today announced an Internet phone-calling application that can be downloaded for free to iPhone and BlackBerry smartphones allowing international calls through Wi-Fi or cellular networks.

With the application, the service can save a customer more than 50% on calls to dozens of foreign countries when compared to rates charged by wireless carriers, Vonage officials said.

The application, Vonage Mobile, was available for free today at on the company's ">Web site and the iTunes App Store. In addition to iPhone and BlackBerry devices, it will work with iPod Touch devices, which connect via a Wi-Fi network, Vonage said.

The iPhone will allow a Vonage call on both cellular and Wi-Fi networks, while BlackBerry devices will make Vonage calls via cellular networks.

To make international calls via Vonage, users will launch the application in iTunes, then Vonage will route the international portion of the call over its network. For iPhone users, the application attempts to work via Wi-Fi first, but if Wi-Fi is unavailable, the call is made via a cellular network. Such calls are seen as local wireless calls and will use the minutes on a caller s phone plan only, Mike Tempora, Vonage senior vice president of product management.

For the Vonage portion of the call, international rates will be extremely competitive with rival Skype, a Vonage spokesman said. Skype offers Internet calls from iPhones, but only via Wi-Fi, a service it started earlier this year.

Vonage makes its international mobile calling rate sheet available with the application download, listing rates for 258 countries. For example, a call to Colombia from the U.S. via Vonage Mobile would be 9.9 cents a minute, Vonage said, well below wireless rates from various carriers of moreo than $2 per minute. A call to the U.K. will cost 25 cents a minute over Vonage Mobile.

There is no monthly service fee for Vonage Mobile, although the company plans to launch a Vonage World plan for mobile later this year at a set monthly fee to make unlimited calls to more than 60 countries. The amount of that fee was not announced.

The Vonage Mobile application was approved by Apple Inc. AT&T Inc., which is the sole wireless carrier for the iPhone sales, and Research in Motion Ltd., the maker of BlackBerry devices, Vonage officials said.

The future of voice over IP wireless calling has been called into question by traditional carriers and is under review by the Federal Communications Commission. FCC Chairman Julius Genachowski recently called for expanding broadband policies to mobile broadband providers, a move that is opposed by the CTIA, a trade group representing the major wireless carriers, and backed by Vonage and other VoIP over wireless providers.

Tempora said Vonage is a longstanding net neutrality supporter and was encouraged by Genachowski's recent endorsement and the future for Internet calling via wireless. "We look forward to providing high quality voice and messaging over any device, from any location, over any broadband network," Tempora said.

In-Stat analyst Frank Dickson, in an interview, said the potential market for Internet calling is "huge." His company recently wrote a note about ways that mobile VoIP poses a direct threat to the revenues of wireless carriers, even for in-country calling. In-Stat said users of mobile VoIP could make more than 22,000 minutes of mobile VoIP calls for $30 a month, costing essentially one-tenth of a cent per minute.

By 2013, In-Stat said mobile applications will generate $32 billion globally and will be used by 278 million people.

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