That's right, Skype is going to compete with mobile phone carriers. On the 3 network, Skype is going to provide Internet telephone calling direct from a Nokia phone.

Initially the service is only going to be available on the 3 network in Australia, Britain, Italy and Hong Kong and the service will only be enabled on a few select phones.

Skype is entering an already crowded marketplace, where local operators are keen to keep all mobile calling and not share with an Internet provider. However, with 3 entering this space, it is likely that this is going to have a downward pressure on mobile telephone costs.

Additionally, there is no announcement as to when Skype might enter the US market. Carriers in the US are likely to close ranks and not allow a cheaper calling rate such as with Skype.