3 UK and Skype develop mobile handset

Mobile phone operator, 3 UK, is working with Skype and a handset manufacturer in the Far East, to develop a low-cost handset which will make it easy to make free calls using the mobile internet.

The Skype mobile phone will be launched later this year and will be available to contract and pre-pay customers, according to a report in the Guardian newspaper.

The handset is expected to cost less than £100 and to be available on pre-paid and contract terms, significantly broadening Skype’s potential customer base.

It will also provide a major differentiator for 3, helping it to compete against rivals.

Skype customers will be able to log with their existing account details.