'Free' Skype Could Be Costly

Skype Ltd. is sure to attract more consumers with its “free calling to the U.S. and Canada” deal. But might it also aid criminals and telemarketers, since IP-to-PSTN calls are tough to trace? (See Analysts: Skype Freebie Is Defensive.)

That's a very real concern these days, especially given the uproar over the government's domestic spying program, which reportedly makes use of phone company records and databases. And because voice calls originating on the Internet are more difficult to trace to a physical location, the Skype service may become the proverbial “public payphone” for stalkers, telemarketers, and other harassers.

Representatives of Skype, which is owned by eBay Inc. (Nasdaq: EBAY), wouldn't address the concerns head on. "I can tell you that Skype is extremely secure and an outstanding way for people everywhere to stay in touch," said Erica Jostedt, a PR firm spokeswoman for Skype.

When a call is placed via Skype to a regular landline phone, a dummy caller ID number comes up. When Light Reading did this, the number “000-012-3456” appeared on the screen of a cell phone. And callback attempts were futile.

A police department spokesman in San Francisco said a harassed or threatened user must first call their phone company to trace the call before the police will get involved. No trace, no bust.

The telephone company does have some latitude to track down Internet callers, but that requires cooperation of the VOIP provider (in this case, Skype) and the ISP used by the caller.

Even then, says attorney Jonathan Askin of Pulver.com , your best hope is to get an IP address where the call originated -- and that alone doesn't necessarily find the perpetrator.

Pulver.com operates a Skype-like Internet voice service called Free World Dialup. Askin says his company has been asked several times by law enforcement agencies like the FBI to help track down malicious callers, and has cooperated fully on each occasion.

Skype might also be a boon for illegitimate telemarketers.

Legitimate telemarketing firms buy software that removes "Do Not Call" list numbers from their prospect lists. Should a telemarketer deliberately call a number on the DNC list, the call could be traced back to them, at which time a large fine (as much as $15,000) could be levied. That threat could evaporate if free VOIP-to-PSTN calling catches on.

The FCC’s Consumer and Governmental Affairs Bureau also could do little for telemarketing victims without at least a valid caller ID number. “Quite honestly, there’s no way you can file the complaint, because if there’s nothing you can give us there’s nothing to look at,” said an agency spokeswoman, who didn't want to be named. “So you have to start backwards and maybe work with your phone company to get that.”

But if it really comes down to it, law enforcement, with the help of the courts, has a fair shot of indentifying a Skype-using bad guy. A Department of Justice spokesman tells Light Reading that because Skype interconnects with the PSTN, the service likely attaches key routing and origination data to the voice transmissions. Law enforcement could use that information to track the user to Skype, and Skype would likely provide more information, the official said. If need be, he said, the perpetrator's ISP could then be identified and asked to produce a name and address.

The official added that no such case had been pursued by the agency to date.

— Mark Sullivan, Reporter, Light Reading, special to Dark Reading