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O2 Connect, which is first being launched as a limited trial in the UK, is the first product to come out of Telefonica Digital. This is the new unit set up by O2’s parent company Telefonica (NYSE: TEF) to drive more innovative digital services centrally that can be implemented across the whole of Telefonica’s footprint, which spans from mobile and fixed operations in Latin America through to Europe.
Both Bobsled — a free fixed and mobile internet calling service that T-Mobile is using as a way to reach out to consumers that are not already on its network — and O2 Connect are drawing on inspiration from Skype, the internet-based calling service that has make big inroads into wireless services through its multiple mobile apps. Skype is currently leading the pack of similar services, and is in the process of getting acquired by Microsoft.
While Skype was once seen as a threat to the mobile operators — many of whom went so far as to block the service outright — today’s approach from O2 underscores the change that has taken place as networks have become faster, consumers have become more price-conscious and tech-savvy, and operators have decided to follow the old saying, “If you can’t beat ’em, join ’em.”
Unlike Bobsled, it looks like O2 Connect is a product intended specifically for O2’s existing customers, and it will only work over WiFi networks. That could mean whatever usage O2 gets from this service will not necessarily affect the revenues it gets from its subscribers for other services such as voice or data.
In its initial form, it will offer users a mobile app, for either iOS or Android platforms, which will work over WiFi networks to give the user free calls and texts to any other UK mobile or fixed line. According to the FT, a customer can use the app on any supported device, and it will still appear as if the call is coming from that person’s own mobile number. This technology was originally developed by Jajah, an internet telephony company that O2 acquired in 2007 for $206 million.
Support for more platforms is apparently in the works, and the intention is to take the service into Telefonica’s other markets.
This is not the first VoIP experiment that has come out of O2 Labs, which is now part of Telefonica Digital. Social Call is an app, also for O2 users, that lets users call their Facebook friends from their mobiles, as long as they are logged into Facebook’s Chat service. That’s very similar to what T-Mobile’s Bobsled offers, except that O2 charges the price of a normal call for each connection a user makes.