When UTStarcom announced it had a "WiFi Phone" (right) no one noticed.

Now that Vonage says it's putting its name on the thing, the carrier world is up in arms.

As usual the press is being plain silly. This is not a threat to mobile carriers because WiFi, as yet, offers no real mobility. And that's just not likely to happen because most WiFi connections are not networked.

This is a natural evolution. You have a wireless LAN in your home, and broadband Internet going out. You use this as your cordless phone and stop paying long distance charges. When you're at home.

The real financial power from a WiFi phone, of course, comes in an institutional setting. Put them into the hands of students and teachers at a university campus with WiFi and fiber broadband, or in the hands of tenants in a building with WiFi provided by the landlord, or in the hands of patients and families in hospitals.

What most reporters are focusing on is the short-term hit to cellular providers, who supposedly have to compete with WiFi phones. But that competition is minimal. Most people don't use most of their minutes already, and in fact many people now use mobiles instead of landlines for long distance because of those cost advantages.

The Clue you take from this is that the old paradigm is dead. The per-minute charge is dead. Long live the monthly subscription.