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The companies plan to launch the product early next year and it will be available as an extension to Cisco's CallManager IP-based standards-compliant communication systems.

The companies say that such a phone will reduce call costs and add security features only available to IP-based communication.

'This innovative collaboration combines the expertise of two world-leading companies to deliver a complete

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communication ecosystem that meets the diverse and demanding business-critical communications requirements of today's most dynamic businesses,' said Greg Brown, President of Motorola's Government and Enterprise Mobility Solutions business. 'Our solution will extend the power of integrated communications services across the enterprise and seamlessly out into the world.'

Handset manufacturers are increasingly looking to add WiFi to phones, just as PDAs have become smartphones with the additions of cellular radios. Motorola is also the supplier of the initial handset for BT's dual-mode service: BT Fusion.

Motorola also announced plans to team with Internet telephony software company Skype earlier this year.

As VoIP matures and wireless access becomes more readily available, so the stage is set for handset manufacturers to wrest power back from the telcos, who will undoubtedly be reluctant to watch those expensive mobile calls eaten into by free or low-cost calls made over the Internet.