Skype releases peer-to-peer voice over IP calling software for Wi-Fi-enabled Windows Mobile 2003 Pocket PCs: The latest release of Skype today offers free VoIP for Pocket PCs that have Windows Mobile 2003 installed and built-in Wi-Fi. Skype is incompatible with SIP (Session Initiation Protocol) gateways used for most other VoIP calling and cannot bridge to the PSTN (Public Switched Telephone Network) to make calls to wireline phones or cell phones.
Skype has received a lot of attention for bringing their Kazaa-like distributed peer-to-peer file sharing ideology to voice calls. In the Skype networks, there is no center: information about who is online is distributed through interconnected peers. The calls are connected end to end, and they claim to have advanced NAT (Network Address Translation) traversal that avoids some of the problems with other VoIP clients. (Of course, some of those VoIP clients claim the same thing.)
Skype claims 850,000 users worldwide. The company is based in Estonia, among other ill-defined places; the founders are avoiding geographical specificity because of the swarm of litigation around Kazaa.
The founders stated in Fortune about two months ago that they planned to make money from the venture by offering a variety of telephony value-added services, such as voicemail. Today's Reuters story also states that they will link to the PSTN for call completion in three to four months, and that will allow them to collect a per-minute rate from their users. They say they will offer a competitive rate; many competing services charge under four cents a minute for domestic U.S. call completion on the PSTN.