International Phone Calls: Pricey No More

Sept. 14, 2007 — For all of the services cell phones offer — calls, pictures, text messages, music — it still often costs more than a dollar a minute to ring international numbers. And for callers who live in Canada, Mexico, or Russia, domestic long distance charges can be 30 cents per minute.

A Vancouver-based company is hoping to change that. Eqo (pronounced "echo") Communications has developed software that, when downloaded to a cell phone, uses the Internet to make cheap calls, locally or abroad.

The model is similar to Skype, said Bill Tam, CEO of Eqo, referring to the free software that allows users to make calls over the Internet from their computers. A Skype user can call another Skype user for free, or call a non-Skype user very cheaply.

But while Skype can be used on some handheld computers, it cannot be used on all mobile phones.

Enter Eqo. It works on standard mobile phones that have basic Internet service. First, a user downloads Eqo's software to the phone. Next, the software automatically organizes existing contacts into the Eqo application.

Once the contacts are set up, the phone owner can see which contacts are Eqo users. They can be called for free, whether they live in the next county or the next country.

"We like to say that it takes your local minutes and turns them into international minutes," said co-founder and chief software architect Jeff LaPorte, who developed the technology that makes Eqo work.

If a user calls a contact who does not have Eqo, it costs about 2 cents a minute.

Most cell phone users in the United States have a plan that allows them to make calls nationwide for the same fee, so the real benefit comes from making international calls, said Tam.

"As an example, AT&T/Cingular charges $1.49 per minute for calls to the U.K. when you're not on an international plan. Our rate is 2.3 cents per minute to a UK landline," he said.

Canadians will save on domestic calling fees that charge up to 30 cents per minute. And for European callers, who tend to cross international borders with the same frequency that Americans cross state borders, said Tam, the savings could be big. A call from London to Paris on a typical carrier could cost $20, compared to 23 cents on Eqo.

But are the savings enough to motivate people to download the software and figure out how to use it?

Maybe not. "You have to go around your elbow to get to your thumb," said Charles Golvin, principal analyst at Forrester Research in San Francisco.

And even if people do download it, there could be some fall-off in usage if the service is not convenient enough. It might be easier to just get a calling card, said Golvin, or if a person makes international calls infrequently, then they might just ignore the "ridiculous rates that the carriers charge to offset the hassle."

Currently, Eqo is available in 29 countries throughout Europe and the Middle East. But according to Tam, the software will be available in 40 countries by the end of this year and in 60 countries by the end of 2008.

Related Links:

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