All major cell phone carriers offer international calling plans. But how much do they earn from these calls? If Verizon’s new partnership with Skype provides any insight, it’s that carriers don’t make too much from subscribers calling internationally. Under the terms of the agreement, Verizon users can call international numbers through the Skype application and pay only Skype’s international rates, which start at 2.1 cents per minute. Instead of collecting their normal international rates, or even the 2.1 cents per minute Skype charges, Verizon will collect nothing directly from the user. The calls, routed over Verizon’s voice and 3G network, will not count against a user’s monthly minutes. How, then, does Verizon benefit from the deal?
We saw no financial terms of the deal, which is pretty standard. What I’m taking from it is that Verizon’s international calling program makes it so little that it’s willing to take the more predictable income from a Skype partnership than continue to host the bulk of international calls itself. Then again, since the Skype app will only be available on select smartphones, to begin with at least, perhaps Verizon makes enough international income from its consumer phones, and thinks that the Skype income from smartphone users will be a nice supplement.
In addition to cheap international calls, the Skype application will allow users to make unlimited Skype-to-Skype calls without using up minutes. This again might seem to cut into Verizon’s profits, but there are probably other issues at play here. For instance, they might have many users already on unlimited calling plans, the price of which they recently reduced. Also, many subscribers don’t use their full minutes allotment each month, anyway. With unlimited Verizon-to-Verizon and unlimited nights and weekends, most used minutes don’t count against monthly plan totals.
Verizon will make the Skype application available next month on the following smartphones: BlackBerry Storm 9530 and Storm 2, BlackBerry Curves 8330 and 8530, BlackBerry 8830 World Edition, BlackBerry Tour, Motorola Droid, HTC Droid Eris, and the Motorola Devour. I assume they’ll add the BlackBerry Tour 2 to the list once it’s announced and released.
Share this Post
Subscribe and Follow
Subscribe to the Going Cellular feed via RSS and follow Going Cellular on Twitter!
{ 0 comments… add one now }