The converging worlds of Internet Services and Mobile Phone Networks.

The list of amazing, new, recently launched products is stunning. We have the Apple iPhone, the iPod Touch, the new mobile phone platform, Android or... how about the Skype phone?

The Skype phone launched by mobile operator Three may be the riskiest of all the aforementioned products, but it is almost the most revolutionary product.

Skype, the service, was created in 2003 by entrepreneurs Niklas Zennström and Janus Friis to allow the user to make free phone calls across the Internet to landlines and mobile handsets across the globe. Today Skype also allows its users to instant messaging, conference calling, file transfer, SMS and video calls.

For me, Skype is a fantastic product which I have used weekly for over two years to make video calls to the family computer at home from both University and Spain. I have aways found the experience of using Skype enjoyable. For example, streaming video from my webcam across the country or globe is effortless. Therefore, the ability to make calls to my contacts for free from my mobile handset is very appealing. If you do not already have Skype installed on your computer, you can get the application free from http://www.skype.com/download/.

The all new Skype phone is an elegant, purpose-built phone that allows users access to all their Skype contacts via the “Skype Button”. The handset comes with 3G, two megapixel camera, mp3 player, mobile TV and Internet. It is styled in black or white, with blue or pink trim. I think the phone is likely to be well received by any tech-savvy user who enjoys attractive gadgets.

Ok then, great application, beautiful phone... Why does a mobile phone operator want to include a free application developed to make free phone calls on a platform normally reserved for subscription-based communication?

Simple: to steal customers from other networks, through the expansion of services and combining services and established brands.

Currently Skype has an estimated 2.5 million registered users in the UK alone. According to the company itself, there are 246 million accounts, however only 70 million of registered accounts are regularly active. Typically, at any given moment, there are between 8.5 and 10 million users logged into Skype.

It will be interesting to see how the addition of Skype is going to effect the mobile telecoms industry – even though I don't think it’s going to make a big difference because the phone is targeting a very specific slice of the market. What’s more, most phone owners are unlikely to be affected and will be unfazed by changing mobile “Internet data transfer” tariffs. The majority of phone owners are likely to be interested only in the number of SMS and cross network minutes included in the monthly contract. Also, the inclusion of free Skype calls is unlikely to effect the traditional telephone model with most of the revenue still generated by subscriptions and prepay top-ups.

Obviously this phone is not going to suit everyone. However, the ability to take a very popular and useful application with you on a purpose-built handset is a fantastic addition to our digital lives.