• Wall Street Journal, Monday, March 30, 2009 11:45 AM

EBay's Skype unit will release a version of its Internet-based phone software for Apple's iPhone Tuesday that will pit the company's VOIP (voice over Internet protocol) technology more directly against network operators such as AT&T and Verizon Wireless, Geoffrey A. Fowler and Amol Sharma report. It allows free calls to Skype users on computers or supported cell phones with Wi-Fi, or they may call landlines for a typical fee, of 2.1 cents a minute.

Skype COO Scott Durchslag says the iPhone product is part of a strategic push toward cell phones, as opposed to the calls from computers, for which Skype is known. Mobile devices are "where the majority of the world's conversations are happening these days," he says. "It is the No. 1 request that we get from our customers."

The move threatens the business models of wireless carriers, which generate the bulk of their revenue from calling plans. But the Skype iPhone software makes calls only when users are connected to a Wi-Fi network, which offers short-range wireless broadband Internet access around a "hot spot," and not over the AT&T 3G data network that iPhone's U.S. users already pay to access.

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