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Nokia N97 Vetoed By O2 & Orange Over Skype Integration

Gordon Kelly


Nokia N97 Vetoed By O2 & Orange Over Skype Integration

At the back end of the Mobile World Congress in mid-February it was announced that Nokia would be integrating 3G Skype access into the N97. Despite more flashy unveilings I suggested it could "have the biggest long term repercussions of anything announced this week" and here's why...

Both O2 and Orange have blocked the sale of the Finnish company's latest (and arguably greatest) flagship handset on their networks over the inclusion of the VoIP software.

Speaking to Mobile Today, an operator which asked to remain anonymous said "This is another example of them trying to build an ecosystem that is all about Nokia and reduces the operator to a dumb pipe. Some people like 3 may be in a position where it could make sense to accept that. But if you spend upwards of £40m per year building your brand, you don't want to be just a dumb pipe do you? Nokia have tried several ways to own the customer over the years and operators have had to say no."

O2 was marginally less cold: "We are currently working with Nokia to understand their Skype service and the business model around it," it explained.

The problem for mobile networks however is that their future is that of a dumb pipe. There is no getting around it. The software is on the phone, the value is on the phone and networks are simply there to provide airtime and data. In fact soon enough, the non-geographic nature of VoIP will see even airtime rendered obsolete and networks will be little more than mobile ISPs - especially with the arrival of LTE. There's no margin in this for them but then again the Post Office wasn't too happy with the invention of email. It's called progress and they're going to have to suck it up.

To use another analogy: imagine being told by your broadband provider that it has the right to choose what software you can install on your PC and carries the ability to block it. That would simply be unheard of these days for any legal programme or service and VoIP certainly isn't illegal. Furthermore, as the smartphone is becoming ever more the mobile computer this is an inevitable and ongoing clash.

I understand your stress mobile networks, you've made billions under the existing infrastructure and will make far less under a new one but the game is changing now and there's nothing you can do about it. Besides, I'm sure 3 - and it's happy acceptance of Skype over its network via the progressive Skypephone series - will be happy to take all your business from you...

Update: Skype has been in touch with us and understandably it can't say too much, but certainly its heart is in the right place:

"Skype does not comment on rumours, however, our beliefs are clear. Skype believes that consumers should be entitled to an open Internet whenever and wherever they want to have a conversation."

Spot on fellas.


via Mobile Today


March 2, 2009, 8:42 pm

Absolutely...Networks are dumb pipes.

Their job is to be the best dumb-pipe supplier out there, that will keep us coming back and keep them in profit. Don't get greedy now.

Besides, we can just re-install it immediately after buying the handset. And, what's the difference between this and running the freely available 'Fring' program? (there are other programs that facilitate Skype access too)

Give it up Telcos, embrace the dumb-pipe model and leave the software and content well alone.


March 2, 2009, 8:58 pm

"To use another analogy: imagine being told by your broadband provider that it has the right to choose what software you can install on your PC and carries the ability to block it. That would simply be unheard of these days for any legal programme or service and VoIP certainly isn't illegal."

But if your ISP subsidised the cost of your PC as part of your broadband deal, they might have more of a claim to decide what software you run, right? There's nothing (finances allowing) to stop you dropping &#163650 or whatever on a SIM-free N97 and using it on whatever network you like, Skype and all.

Ultimately, just as the Compuserves and AOLs of the world had to accept the ISP's modern role as a data carrier rather than a content provider, market forces will inevitably force the mobile networks to accept "dumb pipe" (or, to use a less partisan phrase, "neutral carrier") status, and they will have to adjust their business models accordingly to survive, but - though I am irritated by device lockdowns and arbitrary limitations as much as the next person - you can't really blame them for trying to preserve their current revenue streams for as long as possible by exerting some level of control over the heavily subsidised hardware we (in the UK mobile phone market at least) have come to expect.


March 2, 2009, 9:02 pm

@lifethroughalens - actually, you probably can't just reinstall it without some pretty heavy duty fiddling. With the N95 on Orange, not only is Truphone (VOIP software that is installed on the SIM-free N95 by default) not installed, the phone is locked to network specific firmware that actually disables the SIP feature required for Truphone - you can install the software but it won't work properly. Truphone has an interesting Youtube video here (http://www.youtube.com/watch?v... showing the missing features.


March 2, 2009, 9:10 pm

"There's nothing (finances allowing) to stop you dropping &#163650 or whatever on a SIM-free N97 and using it on whatever network you like, Skype and all." Except that's not true in many countries, as you'll be breaching the T&C's by using Skype which is in general not allowed to be used on a normal contract.

The networks might subsidise the the handsets, but when they charge you as much as they do a month, I'd rather have a "dumb pipe" service like what I have at the moment (not living in the UK btw), and pay more for my device, as it works out cheaper in the long run, believe it or not.

The UK (and some other countries) got spoiled by the networks offering free handsets and now the networks are trying to tie-in their users with custom tuned handsets which offers less rather than more functionality which might backfire on them in the long run, at least as long as there's competition.


March 2, 2009, 9:14 pm

I really hope that Three strike an exclusivity deal with the N97 and get it out pretty sharpish. I can't wait till it comes out, and I mean that literally. June is a long way away, I'm sure I will be tempted by another phone if released before this.

You can always just change the product code of the phone when you get it and flash with non-brand firmware. This obviously will invalidate your warranty but it's a risk some people take. Or just put down the big bucks for it sim-free.


March 2, 2009, 9:27 pm

@ John McLean

The same companies have no problems offering subsidized laptops with 3G, and they don't lock down what software you can/can't use. So you can install Skype, and to be honest even if they do subsidize the product they have no right to demand a say in the software on that phone as ultimately you are paying full price.

Martin Daler

March 2, 2009, 9:41 pm

I've got this great new business idea. It involves standing on the spot waving my arms around in futile rage whilst being run over by the internet. Any backers?


March 2, 2009, 9:44 pm

I agree with inzimam, since 3 mobile seems to be the most forward thinking of the UK mobile phone providers (i.e. using included minuites abroad when on a 3 network, embracing the skype network on their phones) then if the other networks are snubbing this phone then I would hope they would have the sense to be all over Nokia for this one!

Having an Nokia touchscreen phone exclusive would be a big marketing coup...


March 2, 2009, 10:10 pm

The networks are already half way to being dumb pipes!


March 2, 2009, 10:12 pm

@John McLean - sorry John, your argument is fundamentally flawed as pointed out by The Lost Swede. It would have been a fair point otherwise.


March 2, 2009, 10:20 pm

@Martin Daler - take my money! Please!


March 3, 2009, 3:28 am

well I have an O2 XDA Serra running WinMo 6.1...i have skype installed...and i even tried using the Test Call - works fine.

The problem - check your Terms and Conditions on O2 and you are not permitted to use File sharing or VoIP...and that includes their mobile broadband dongles from what i can read.


March 3, 2009, 3:44 am

In Denmark the providers primarily serve as "dumb pipes", as you lovingly put it, and it seems our telephone operators are quite satisfied with this system. Telia, the scandinavian carrier of the Apple-phone, recently announced that they will gradually out phase subsidised handsets, in exchange for cheaper subscriptiopns. But the question is; are people really ready to pay the actual price of a modern handset? Without knowing an exact average I would guess they would usually be &#8364500 or &#8364600.

You may say that; "It works out cheaper in the end", but people are inherently short sighted (just take all this financial hysteria as an example), and I am pretty sure people would rather have the lower price today, regardless of the shameless high cost of being tied to an evil, software controlling, telco.


March 3, 2009, 4:13 am

John McLean Said: "actually, you probably can't just reinstall it without some pretty heavy duty fiddling"

Hey, if anyone's silly enough to sign a contract on Orange then you deserve to get a locked down, ruined, software limited, nasty orange phone!

Reflashing FW isn't heavy duty fiddling, you don't even need specialist equipment and it only takes 2 minutes to change your product code and get a nice fresh Nokia FW update. People who feel uncomfortable about doing this probably don't care too much if their phones are not working to their potential. (or even if they have a bright orange screen with ugly icons)

Certainly threatening people with 'invalidating warranties' over updating / changing (perfectly legitimate) firmware just to prevent them from accessing services, is plain wrong and should be discouraged in the industry.

As for me, well I just changed my (sim free) Nokia 5800 product code to get a FW update...skype and fring work brilliantly on it :)

As a side note - When are we going to be able to buy data only sim cards? O2's &#1637.50 pm 'unlimited' (yes, I know it's not) is good value and the coverage is great. I don't want another phone number, just a data sim I can stick in to one of my (numerous) phones to make Skype calls on and get emails, all for one flat fee per month.


March 3, 2009, 5:36 am


i suggest flat 12 on 3 mobile and then pay &#1635 a month for 2Gb of data and after every topup for 90 days you get 3,000 skype mins.

compare this to the 200meg for &#1637.50 a month from O2 as you mentioned and you will be laughing and cause its pay as you go no tie in.

I'm going on that ASAP.


March 3, 2009, 6:53 am

@Jay - ever get the feeling this is the exact conversation the telcos are desperately hoping consumers don't start having... ;)


March 3, 2009, 6:32 pm

Hey Jay, cheers for that...sounds like a plan worth investigating :)

Evil Telcos, get your act together! (harsh, but fair)


March 4, 2009, 1:43 am

Hey let the sheep buy the "subsidised" phones. The state of affairs today is that the market is mature and people dont need hand holding. And prices of smartphones are going DOWN by the way. The capability you get in 200 quid smartphone like say the Nokia E51 or upcoming E55 is phenomenal.

I prefer to pay from my own phone than be stuck with what is basically a 1998-era AOL walled garden with AOL computer and software. That is just backward.


March 4, 2009, 3:51 am

@Gordon - thought I'd try and get the ball moving knowing how much power the consumer does actually have, and knowing some certain practices have to change as I'm sure other people want properly unlimited data like the iPhone customers have.

but I would like if this app for the N97 isnt compatible with other nokia phones I'd like skype to make their skype app able to be used over wifi so its more usefull to everyone.


March 15, 2009, 6:06 pm

Get your phone and flash it with regional firmware.

While your warranty's probably a gone case, you can do whatever the hell you want to do with it.

Like use Skype.

Kazam Bokhari

March 17, 2009, 1:46 am

Does anyone know whether Orange/O2 have decided what they are going to do? Will they drop it, or simply rape the software so that users cannot use it freely?

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