Nokia entering VoIP Market!

“Nokia is introducing new mobile phone handsets that will enable users to make calls over the internet” reports BBC News under the title Nokia Launching Net Call Handsets. Two Nokia phones (6136 and N80) will be equipped with the technology initially. They are expected to have dual use: calls being routed through net link if the phone is within the range and calls return to standard mobile phone network when the phone is outside the range. Since Voice over IP [VoIP] technology uses same wires used to browse the internet, calls are expected to be cheaper than when using standard phone networks. Nokia made this announcement at the showcases of the sector’s latest technological developments. Is Nokia’s business concept innovative?
VoIP has been around since mid-1990s with personal computer to personal computer phone calls (Belanger, Slyke) to internet phones (PC to regular phones). Nokia’s VoIP enabled handsets seem to be a new way of differentiating its existing business concept by adding the usage of internet to its standard mobile phone network. Though already beaten by BT with its [VoIP] mobile phone version – BT Fusion, Nokia is still among the first movers into this market. But does this concept provide potential for wealth? Some analysts believe that users are unconvinced by the latest 3G phone services (VoIP handsets included) since these services are complicated and require extra payment from users. If what analysts think is true, then Nokia’s VoIP handsets though valuable and rare for the time being might not allow the company to benefit from the competitive advantage it tries to build with its business concept.
Moreover, since VoIP has been there for a while, Nokia or BT’s mobile phones can easily be imitated by competitors since the technology is available for everyone. Rivalry is also intense within the industry since mobile phones lack differentiation or switching costs. In addition personal computers are already