jvorback: Talking to our company's mobile account manager, Telecom's T3G service can already handle live video calling - the just haven't bothered turning it on because it's had such as lukewarm response everywhere else in the world.
After all, both Telecom and Vodafone use CDMA technology for their 3G networks, so it would make sense that if one can do it so can the other. The feedback that I've had from people who have seen video calling in action is that the quality is pretty poor, especially if there's any movement involved (forget trying to video someone waterskiing down a flooded street - nice commercial, not very realistic)
The problem that Vodafone have is that this type of technology appeals mainly to kids, and most of them can't afford the cost of the phone. And even if they did get one, chances are that no one else they know would have one. So... who that gonna call?
As crappy as txt seems to me, it's still the biggest selling point among kids. Telecom's $10 bucks a month plan really was a master-stroke.
You seem to forget that Video Calling is an evolutionary process, in terms of the network performance. Currently the Vodafone UMTS 3G Network is 384 download/64 upload & latency is quite high, naturally this will effect the Video Calling quality. I have used it & find it fine, it does the job & I know it will only get better, due to the fact that it's on a mobile, the uses are even more greater. The network coverage will also increase significantly over the next 12-18 months.
Also, the speed will be increased significantly with the implementation of HSDPA & HSUPA & the Video Quality WILL improve "significantly". The Video Calling technology is very new, Vodafone introduced into New Zealand in August, hence like any electronic product it's expensive when it first comes out. The cost of the phones WILL come down, they already are right now. I also disagree with your statement about this technology only being good for kids, it has a whole multitude of uses, limited only by your imagination for adults as well :-)