Friday, May 29, 2015

Would a "Level Playing Field" Save Voice?

Former Vodafone India CEO and Managing Director Martin Pieters says over-the-top apps could be “fatal,” noting that 85 percent of mobile operator revenue is earned from voice services at risk from OTT alternatives.

On the other hand, there is a solution: data and other revenue sources. That will happen, according to the Cisco Visual Networking Index.

IP traffic in India will grow 400 percent from 2014 to 2019, a compound annual growth of 33 percent.

More to the point, smartphones will account for 40 percent (651.4 million) of all networked devices in 2019, compared to 13 percent (139.8 million) in 2014, representing a 36 percent compound annual growth rate.

The point is that, in India, as elsewhere, mobile Internet services will replace voice revenues.

“We are not denying the new reality but we are just saying give us some more time to adjust,” he said.

That, in essence, is the framework for the current debate in India about whether OTT voice apps should be subject to the same rules as carrier voice faces.

However the matter is resolved, the basic issue is a common one in the communications business. Whenever incumbents have faced new competition, or a major new replacement industry, such regulatory conflicts have developed.

That now is true of TV broadcasting and linear TV, which will necessarily spar over rules related to online video. Broadcasters fought to make use of videotape recorders and cloud storage devices illegal.

Huge fights over the regulatory treatment of VoIP services were fought in the 1990s.

As difficult as it seems, Indian mobile operators will simply have to move faster to create new revenue streams from mobile data and other sources. That is the strategic direction happening everywhere in the mobile business.

It will not be a comfortable transition. But there is no other strategic choice. So far, the history of attempts to outlaw OTT apps, when consumers want to use them, has broken down, in the end.

But Pieters is right about one thing: where regulatory treatment of carrier voice and VoIP has been more equivalent, the transition has arguably been more gradual. But nothing has prevented the cost of using any form of voice gone any direction but down, anywhere.

Voice in India is not going to be saved by “leveling the regulatory playing field.”

The M Hotel Singapore | 10-11 September 2015

In India, as Elsewhere, Only Mobile Internet Access Can Replace Lost Voice Revenue

Getting billions of new consumers connected to the Internet is not just the right thing to do: it is necessary. Near term, mobile Internet revenue and high speed access generally is the only way service providers will replace lost voice revenue.

Spectrum Futures 2015 will bring together regulators and service providers from throughout the Asia-Pacific region to allow the exchange of ideas about key policies to help emerging markets like India, the Phillipines, Thailand, Indonesia, Cambodia and Myanmar connect to their populations to the Internet within the next decade.

Join the conversation at Spectrum Futures 2015.