The first hint Engadget picked up on was that Skype will be participating in a CES panel discussion titled "Video Calling Gets Ready for Primetime." Of course, panel discussions usually include participants from a number of companies, so that's not enough to base a rumor on.
The kicker was an email received by the team that contained a link to a help document on Skype's site. The title? "How do I make video calls with Skype for iPhone?" While a search of the Skype site didn't reveal that document to your humble TUAW correspondent, we trust our sister site enough to believe that they had access to it.
There's no word on whether Skype will be providing the video calling capabilities to all major smartphone operating systems, but we'd bet that they would flip the switch on this capability for at least the iPhone and Android platforms on day one. The ability for the iPhone to make video calls over Skype to any other mobile phone or computer would at least put the damper on Sprint's Android phone ads touting "video calls from anywhere."
Now if Skype can just keep prolonged service outages from happening...