Truphone, a UK-based VoIP provider, will offer a competitively priced SIM-only mobile service for voice, texting and data — effectively becoming a virtual network operator. The company has signed deals with Vodafone (NYSE: VOD) in the UK and an unnamed U.S. operator.
So far, Truphone’s business has been to offer a WiFi-based VoIP service via apps for Android, Apple (NSDQ: AAPL), Blackberry, and Nokia (NYSE: NOK) smartphones. It claims to have gained “hundreds of thousands of subscribers” this way. But this new service instead embraces traditional mobile networks. Called Truphone Local Anywhere, it will offer mobile service over the conventional networks of Vodafone and the unnamed operator. The service will be limited to using standard voice minutes. “This doesn’t use any VoIP at all because that’s one of the things that terrifies an operator,” a spokesperson tells paidContent:UK.
Truphone says that while it is a SIM-only service for now, it plans to bundle the SIMs with handsets in the future.
It’s hard to make money as a VoIP-only operator, as Skype and others have proven. Truphone acquired SIM4Travel, a roaming SIM card provider, in April 2008. SIM4Travel also added a core GSM network to Truphone’s business. It is these assets that Truphone is using to build its own mobile network ambitions.
The data rates it offers are competitive with those of current UK operators: in the UK a megabyte costs £0.50 (81 cents), with unlimited bundles priced at £21-a-month ($33.89). Bundles in the U.S. will cost $30-a-month.
The company says it plans to announce further such agreements in Australia, Africa, Singapore and Hong Kong later this year. Until then, roaming in those countries will be under wholesale agreements, which the company claims still offer a discount on mobile roaming rates.
Geraldine Wilson, the CEO of Truphone, was once the head of Yahoo’s Connected Life division in Europe. The company has raised £36.5 million ($58.9 million) from investors, including the publisher Independent News & Media, Eden Ventures, Burda Digital, Wellington Partners and Straub Ventures. Release