A Swedish company named TerraNet is currently testing a peer-to-peer technology that would allow mobile phone users to call one another without needing mobile towers. Instead, the company's technology uses modified headsets that act as peers and nodes on a mesh network.

According to TerraNet, each handset looks for other mobile phones in a 2km range. Once another is found, calls and text messages can be routed through the nodes with a maximum of seven hops, until they reach the intended destination.

Adapted VoIP being used to make calls

TerraNet's service uses an adapted VoIP technology to make calls. In essence, a few internet-equipped PCs with a USB dongle attached can create the mesh network and transmit calls over the internet to the destination network, which should increase the phone's coverage. It's being tested in Tanzania and Ecuador.

As of this point, only Ericsson has signed on to use the TerraNet service. Ericsson has reportedly invested £3 million into the company.

Judging from the implementation, the TerraNet service is obviously not meant for those looking for the same coverage as cell phones. That said, it might be ideal for areas with spotty or inexistent coverage. Even better, the TerraNet handsets should be relatively cheap and could prove to be another profitable market for current mobile phone manufacturers to sell devices.

There is currently no timetable established for TerraNet's release, but if all goes well, we should be hearing more about this soon.