Skype for iPhone Sparks Battle Between Consumers and Carriers

The release of an official Skype application for the iPhone appears to have been controversial for both mobile carriers and consumers. The Voice-Over-IP software allows iPhone users to make phone calls over Wi-Fi to other Skype users or even to regular landline phones. Obviously, such functionality could compete with mobile carrier's own voice services.

As a concession, Apple has prevented the use of such applications over cellular data networks (EDGE or 3G) and only officially allows it to run on Wi-Fi. (Strangely, several readers have noticed that the Skype application presently does work over 3G when running beta iPhone 3.0 firmware, but that may simply be an oversight on the part of Apple.)

T-Mobile in Germany, however, threatened that it may take action to prevent its customers from using Skype on the iPhone. On the flip side, an open-Internet advocacy group is asking the FCC to see if AT&T and Apple are violating federal rules by restricting Skype to just Wi-Fi.

Free Press and other consumer advocates want the FCC to affirm that so-called net neutrality protections also cover wireless networks. That would prevent AT&T or other operators from blocking services like Skype on their mobile networks.

Skype has proven to be massively popular on the iPhone and iPod Touch reaching over one million downloads in the first two days of availability.