The man who invented the PGP (Pretty Good Privacy) is working on a similar project for Internet phones.
Phil Zimmerman unveiled a prototype of his newest invention at Black Hat Conference in Las Vegas. According to Zimmerman, the prototype, called “zfone,” should be available online
at the end of August, for evaluation purposes.
However, the program will be ready for broad deployment in about 12 months. Right now most Internet-phone calls are sent unscrambled, which means that it’s possible for anyone to intercept the traffic. Zimmerman’s prototype is working in the same way as any encryption program.
Zfone scrambles the data until it reaches its destination. The recipient must be running a program using the same protocols
“If you want to have an encrypted call, then you have to call someone running the same software at the other end,” Zimmermann said before the presentation. “Eventually, I’m hoping companies that make VoIP phones will incorporate this protocol into their phones.”
Zimmermann said he planned to start a company to sell his software and his partners in the new venture include VOIP pioneer Jeffrey Pulver and former U.S. counterterrorism czar Richard Clarke.
“I am revealing this now because I want to help shape the direction of secure VoIP,” Zimmermann said in an interview.
VoIP is increasingly popular because it is cheaper than traditional phone service and in some cases free.
According to Gartner Within until 2007, 97 percent of new phone systems installed in North America will be VoIP-based or will use a combination of traditional and VoIP technology.
Cisco claims to have sold some 5 million VoIP phones to customers throughout the world.
OVER-THE-TOP phone bills are leaving plenty of Australians in debt, and many are turning to the Telecommunications Industry Ombudsman (TIO) for help.
In the first quarter of 2005 alone, the TIO received nearly 11,000 complaints about landlines – one-third of them relating to charges. Mobile phones generated even more complaints.
Trouble is, phones are an essential part of our lives, and the cost of staying in touch shouldn’t put you in the red.
Whether it’s a mobile or a landline, there are options available. So understanding your call patterns before signing any deals can keep the phone bills in check.
The Australian Consumers’ Association found that with mobiles, light users were better off with a pre-paid service, whereas heavy users should consider post-paid plans.
If you have broadband access and regularly make long-distance calls, it’s worth considering Internet-based telephony.
Voice over Internet protocol (VoIP) uses the Internet to make phone calls, and long-distance calls can cost a fraction of the normal rate.
A VoIP-based call to a landline phone in Britain, for instance, can cost around five cents a minute compared with 21c a minute under some conventional plans.
Moreover, when you make a call to someone using the same VoIP network – Skype, Firefly and so on – it is often free. There are limitations, however.
The quality of VoIP calls can be variable – users may encounter time lags and intermittent echo. Some VoIP plans require special handsets, others have high set-up costs, and providers may charge monthly fees.
Another snag with VoIP is that you can make calls only using a computer connected to the Net. This may not always be convenient, and during a blackout can leave you stranded.
An alternative may be a pre-paid phone card bought from a newsagent or online.
Phone cards also let you make both interstate and international calls for a fraction of the usual cost. In fact, Kenneth Ting, of Phone Card Selector, says it’s possible to trim 80 to 90 per cent off the cost of an overseas call.
These savings arise because phone-card manufacturers buy phone minutes in bulk from various carriers, and this discount is passed on to consumers. Some cards may use VoIP technology.
Phone cards cost between $5 and $50. To make a call, dial the access number written on your card, which connects you to the network applicable to your particular card.
Once connected, you enter a PIN on the phone keypad and, after a computerised recording indicates the minutes remaining on the card, you dial the phone number.
Cheap calls aren’t the only plus with phone cards. The fact they’re pre-paid means you’re not racking up a huge charge that could prove a struggle to pay.
And, unlike many landline or mobile-phone deals, there are no ongoing contracts tying you to high charges.
At the end of the day, it might not suit you, but it’s worth a look.
Niklas Zennström, the internet entrepreneur behind both Kazaa and Skype, spoke to BBC Click Online about how his two inventions came about, and how broadband and wireless devices are shaping his vision for the future.
There are few people in the world who can claim to have invented something that captured the imagination of hundreds of millions of people.
But Niklas Zennström has done it twice.
It all started while he was working for the European low cost telco Tele 2 in the mid-1990s, where he met his friend and colleague Janus Friis.
By March 2001, the two of them had created Kazaa and were cashing in on the file-swapping boom kicked off by Napster.
What made Kazaa important was that it avoided having centralised lists of what people were swapping.
This arm’s length approach kept it, and other file-sharing services like it, out of trouble.
The result was an explosion of music swapping, and movies soon followed with the widespread take-up of broadband.
Kazaa is estimated to have been downloaded onto more than 140 million machines.
But while Zennström thought it had great potential from the start, he did not know exactly what people would use it for – be it shareware for software, video or anything else.
“So we made it as open as possible and then we thought we’d see what people used it for”, he says.
“Then people started using it more and more and it became the most downloaded software on the internet.”
As Napster was already such a dominant player, he and Friis thought there was no chance of Kazaa competing in the music arena.
He says: “It was more a technical proof of concept that it was possible to transfer files between two end users rather than going through servers.”
But something about Kazaa caught the public’s imagination to set it above all the other file-sharing programs available.
Zennström says there were two reasons why Kazaa struck gold.
“One was that we had a very new type of technology that took care of all the problems, so that everything worked.
“We also packaged this in a user interface that was very easily used, so that the user could use the software, search for something, download it and it just worked.”
Despite the instances of illegal file-sharing that have resulted from the popularity of such networks, Zennström does not admit to a guilty conscience.
“Ultimately these are great things”, he asserts.
He also compares the problems faced by the new medium to similar issues of the past.
“When radio stations started playing music the record companies started suing radio stations. They thought now that people could listen to music for free, who would want to buy a record in a record shop? But I think we all agree that radio stations are good stuff.
“And the VCR did the same thing: the movie industry thought nobody would ever watch movies any more.
“But that technology enabled the movie industry to make much more revenue. The single largest revenue source for the movie industry is videos.”
Kazaa has also been criticised for including malware and spyware as a way of getting some money back.
Zennström agrees the amount of adware in programs like Kazaa, and some of the other file-sharing networks, is “way too much”.
“It destroys the user experience”, he says.
Kazaa initially had a very limited number of advertisements, which he says “wasn’t that bad in the beginning”, but they grew over time.
“That’s something that me and Janus learnt as an experience, and with Skype we did not have any type of advertisements whatsoever.”
Zennström’s latest venture, Skype, was launched in 2003 and, just like Kazaa, it exploits a new and emerging technology.
Called VoIP (Voice over Internet Protocol), it lets people use the internet to make free or very cheap phone calls around the world.
Skype Me!It is a free download, and the service is free too, so it is no big surprise that Skype now has the largest number of users in the VoIP arena and has topped 100 million downloads, all with minimal amounts of advertising.
Zennström says Skype is not at all like Kazaa.
“It’s a different situation. This technology enables people to communicate directly.
“And obviously it undercuts a lot of revenues of the big phone companies, who have been using outdated technology.
“Again, it’s something that will prevail because it’s ultimately very beneficial for end users – consumers and businesses.”
But it is not completely free, says Zennström, “in that you need to have a computer and an internet connection, preferably broadband”.
Careful pricing model
Skype makes money because a small fraction of users is buying additional services, such as the capability to call from Skype to the telephone network or vice versa.
Not having to make money from every user is not a new idea, Zennström emphasises.
“It is very similar to companies like Google and other internet companies. When you go and search on Google you don’t pay for that. But sometimes you click on an advert and Google makes money on that.
“It’s the same thing with Skype. Some users are paying for services, but not everyone.”
Zennström believes the losers out of this new structure will be the telcos who do not understand that there is a change going on.
“This is a disruptive technology that shifts the industry”, he says.
He believes Skype will take away revenue from phone calls, which is the bulk of the revenue for phone companies.
“That will go away in the future – all phone calls will be free. That’s obviously an issue for them.
“On the other hand, Skype, just like Kazaa and other software, are encouraging people to buy broadband connections.
“Today, less than half of the population has broadband. This enables the phone companies to sell broadband to the other half.”
As for the future, Zennström says Skype is a long-term project.
“We have just started, and if you compare the number of people using Skype to the number using a telephone network around the world, we’re still just starting.
“And now we’re also very much focussing on moving away from the computer into mobile devices, so you can use Skype for free wirelessly.”
BT has unveiled a mobile phone that uses Bluetooth and VoIP technology to automatically connect to a landline when used at home.
The world’s first hybrid telephone, designed to switch seamlessly between mobile and landline networks, was unveiled yesterday.
In the home, the BT Fusion handset is linked wirelessly to a base station and behaves like a conventional fixed line cordless phone.
But outside, the phone automatically turns into a mobile phone, charging full mobile rates.
BT believes that the new handset and base station will be popular among large families, in which children and parents compete to use the landline, and among small businesses. People living in areas with poor mobile phone reception may also be drawn to the service.
The company concedes that most people will continue to have a traditional landline phone in addition to their BT Fusion mobile.
Ian Livingstone, the chief executive officer for BT Retail, said the service had been in development for two years at a cost of “tens of millions of pounds”. “You get all the convenience and features of a mobile phone, but with a fixed-line cost and the quality you are used to with a fixed line,” he said.
The new phone marks an important technical step towards convergence – the point at which mobile and landline phones are completely interchangeable.
To use BT Fusion, homes must sign up to BT Broadband. They will be given a free base station, called a hub, and a free handset.
The hub uses Bluetooth wireless technology to connect to any handset within 25 yards. The box also works as a wireless (wi-fi) router, allowing the owner to connect several PCs and laptops around the home to the internet simultaneously.
Calls made in the home to another fixed-line phone will be charged at 5.5p an hour off-peak and 3p per minute at peak times.
Once the phone is out of range of the hub, it switches to the Vodafone network, where calls are charged at mobile rates.
Customers are allowed to make free two-minute calls from a BT Fusion handset to their home number, up to maximum of 1,000 minutes a month.
Six phones can be registered to any hub using a security personal identification number, three of which can be used at the same time.
It is also possible to register a handset with a hub in a friend’s or relative’s home, or at work. All calls are charged to the owner of the handset, not the hub.
According to BT, the phone switches seamlessly from the base station to the mobile network.
Any calls that begin in the home will continue to be charged at the fixed-line rate, even if the phone moves on to the mobile network.
BT Fusion will initially be available on a Motorola v560 handset. Another Motorola handset, the RAZR, will be launched later in the year. More handsets will follow.
The service will be tested with 400 customers over the summer and start fully in September. A business version will also be launched this year.
One drawback is that calls made to a Fusion handset will be charged at normal mobile rates. By offering free wi-fi boxes with the phones, BT is creating a market for its future broadband services such as internet television.
BT is offering two launch packages – 100 inclusive minutes at £9.99 a month and 200 minutes at £14.99 a month.
The inclusive minutes do not include calls made to fixed-line phones from the home.
The full package for new customers will not come cheap. Users will need to sign up to BT Broadband from £17.99 a month and get a BT line from £10.50 a month.