iPad and iPhone turning VoIP

Apple updated the iPhone software development kit on Wednesday to allow internet telephony apps to work on the 3G network. The little-noticed move effectively unlocks the ability for the iPhone -- and the upcoming iPad -- to be used as web phones in the UK.

iCall, a voice-over-Internet Protocol (VoIP) calling company, said the latest revisions in Apple's iPhone developer agreement and software development kit effectively enable the iPhone to make phone calls over 3G data networks. iCall promptly released an update to its app today, adding the 3G support.

Wired contacted iCall to find out if the service is available in the UK. The company confirmed, saying "the iCall application is available in the UK and should function normally over 3G with UK carriers. We do not currently offer phone numbers in the UK but do have plans to expand into your area in the coming months."

Wired also contacted Orange, a major iPhone service provider in the UK, to see if it will support such apps. Orange offered the following statement. "Orange UK does not block such third party services if customers choose to download them, however we are unable to guarantee the quality or customer experience which these provide."

Because the iPad includes a microphone and will run iPhone apps, that means the tablet will gain internet telephony, too.

Previously, Apple's policy had prohibited VoIP functionality on 3G networks -- Skype, for example, was crippled so that its voice calling capabilities would only work over a Wi-Fi connection. The only way to use VoIP iPhone apps over 3G was by hacking (i.e., jailbreaking) the device.

Apple and American mobile phone carrier AT&T had a secret agreement to ban apps that would let iPhone users make phone calls using the 3G data connection to prevent cutting into AT&T's profits. That agreement was revealed in summer of 2009 when the FCC asked Apple and AT&T to explain why Google's Voice app was rejected from the iPhone store.

After the FCC announced it was planning to extend internet openness rules to mobile networks, AT&T in October 2009 announced it would extend VoIP to 3G networks for the iPhone.

"I applaud Apple's decision to allow iCall to extend its functionality beyond Wi-Fi and onto the 3G networks," iCall said in a press statement. "This heralds a new era for VoIP applications on mobile platforms, especially for iCall and our free calling model. I hope that now more developers will begin using our VoIP as a platform to integrate VoIP into their applications."

Though VoIP services offer cheaper calling plans to consumers, Tero Kuittinen, an MKM Partners telecom analyst, said the impact of VoIP on the telecom market won't be immediate. He noted current VoIP technologies suffer from poor voice quality compared to traditional cellular calls, and with the current state of network congestion, it's not going to get much better anytime soon.

"There's a handful of kids who have always wanted to just make their voice calls on VoIP, but regular consumers have not been very excited about it," Kuittinen said. "With voice over IP over 3G, the quality isn't going to be there for quite some time."

He added that VoIP will probably be much more popular when telecom companies roll out their faster fourth-generation networks, dubbed Long Term Evolution.

The move won't necessarily change things for the famously rejected Google Voice app for the iPhone in the US. Google Voice lets users channel all their calls through a single Google Voice number, which offers cheap international calls, free long-distance calls, free text messaging and voicemail transcription.

Google Voice is not a VoIP service. The calls are placed on a regular mobile phone connection and use the minutes on a mobile phone. Circumventing Apple's blockade, Google recently released a web-based version of Google Voice, which can be accessed through the iPhone web browser. But that web-based version of Google Voice still depends on the iPhone's telephone app to actually place the calls.

Google did not have an announcement regarding Google Voice in light of Apple's new policy. "We haven't heard any updates regarding our native app for the iPhone," a Google spokeswoman said.

Apple has been considering the Google Voice app since at least July 2009.