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Nokia to preinstall Skype on handsets

Operators not sufficiently pissed off yet

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Updated Nokia is pre-installing a Skype client on the flagship N97 handset, being launched in June, allowing users to make VoIP calls without paying a penny to the network operator who is still expected to subsidise the cost of the phone.

It seems like only yesterday Nokia was removing SIP functionality from operator-variant handsets in order to appease the operators and gain that so-valuable subsidy. But now N-Series devices will have a proper Skype client integrated, including presence and messaging as well as VoIP, in a move that isn't going to please network operators at all.

UK operator 3 has had some success with its Skype-Phone, but that isn't really VoIP at all, neither can it make SkypeOut calls - so the user is still dependent on 3 for most of their calls.

Until now there hasn't been a proper mobile-Skype client, except on Windows Mobile. Third-party applications such as Fring have provided the functionality on S60, but starting with the N97 Skype will be an integral part of the phone's capabilities, offering Skype calls in the same way that the current N-Series phones offer SIP connections - or most of them do. But Skype/Nokia goes further as the address book becomes dynamic and displays the presence information about contacts, assuming they have Skype too.

Presence-enabling the address book is a welcome innovation, but integrating with Skype isn't going to amuse the network operators. Not only will users be able to call other Skype users for free over 3G or Wi-Fi connections, but they'll also be able to make SkypeOut calls: potentially reducing the network operator to the bit-pipe they've fought so hard to avoid becoming.

Quite what Nokia gets out of the deal, other than pissing off its biggest customers, isn't clear - unless the company is actively seeking a subsidy-free business model.

It's still possible that operators will manage to convince Nokia to switch off the functionality for variant handsets, as Vodafone did when SIP became available. But the attendant publicity, connected to the Skype brand, will make that hard - assuming Skype can start making enough money to fund its continued existence. ®

Update: Some of our more astute readers have pointed out that you can, since October, make SkypeOut calls on 3 - as covered by us at the time.

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