Now in the App Store is the iPhone version of Skype, which uses Voice Over IP services to talk free to other Skype users — or connect to landlines worldwide at competitive per-minute rates.
Interestingly, using the current iPhone firmware (2.2.1), you can only make calls to other Skype users via Wi-Fi — attempts to connect via 3G pops up a warning message. Additionally, since the current firmie doesn't support push, the only way you'll know if someone's Skype-dialing you is if you have the app open all the time. On the other hand, people who have loaded up the OS 3.0 beta report that 3G connections ARE available — but who knows for how long before the Death Star and/or House of Jobs clamp that hole closed.
As for call quality — well, if you weren't wild about how Fring sounded, Skype's no improvement. And you have to worry about an app whose iTunes entry clearly states "Please note: Skype is not responsible for errors or crashes which result from changes to the underlying iPhone OS." Hmm, that pay phone on the corner's looking better and better…
[Still feeling adventurous? Download the free Skype app from the App Store.]