The phone will have normal GSM in it, as well as being Matrix native when on IP (i.e. shipping a native Matrix.org client as the default dialler/messaging app, which will work whenever you have IP connectivity).
A stretch goal is to also provide Matrix<->PSTN connectivity, so that if you're on IP but don't have GSM (or don't have a SIM in the phone), then you could also place/receive calls with the PSTN from Matrix. (Obviously this would then be also available to the rest of the Matrix ecosystem too). (Source: I work on Matrix)
For those of us less informed: assuming a Matrix <-> PSTN bridge exists, does that mean that one would be able to send and receive phone calls and SMS to existing GSM numbers via a dedicated VOIP number? I don't understand PSTN at all, but wouldn't giving all matrix users dedicated VOIP numbers be difficult and costly?
Yup, that's the idea. Given this was the Matrix team's dayjob before getting sucked into Matrix, it's something relatively easy to do - although yes, we'd have to pass through the call/SMS and numbering costs. Now, if only Matrix had a payments ecosystem... https://matrix.org/blog/2017/08/22/thoughts-on-cryptocurrenc...
I think the "we aim" here refers to 3G/4G. The phone is going to have a baseband module, so yes, it will be able to do GSM phone calls & SMS like any old phone. I imagine that adding 3G/4G packet data in a FOSS manner may be harder however.
I think the "we aim" bit is more directed towards certain frequencies rather than "we're not sure if we can get 4G working". Take a look at any group of phones on https://willmyphonework.net and look at the differences between countries. Getting 3G/4G to work globally is a lot harder than just settling for US/Canada or US/Europe.
A stretch goal is to also provide Matrix<->PSTN connectivity, so that if you're on IP but don't have GSM (or don't have a SIM in the phone), then you could also place/receive calls with the PSTN from Matrix. (Obviously this would then be also available to the rest of the Matrix ecosystem too). (Source: I work on Matrix)