Telecom Lead Asia: More mobile operators are expected to start devising new strategies to counter Over-The-Top (OTT) players in 2013.
India’s Reliance Communications has an alliance with WhatsApp, a social messaging brand that has increased its penetration in markets such as Singapore and the Netherlands.
Ovum expects smaller players such as textPlus, Pinterest and fring to cause disruption in the messaging space.
OTT players are already changing consumers’ messaging preferences, and the pressure they are exerting on operators’ messaging services is forcing them to offer increased SMS bundles and to experiment with messaging pricing models, further dampening revenue growth.
Recently, TelecomLead.com reported that mobile network operators need to collaborate with content partners and OTT players if they want to avoid the risk of uncontrolled revenue loss.
During Mobile World Congress 2012, SK Telecom said it will work out new plans to compete against a number of OTT players in Korea. SK Telecom is launching an RCS-based service and deploying its Smart Push technology.
OTT is threatening the revenue streams of mobile operators across the globe.
“Korean mobile carriers are experiencing difficulties, including decreased SMS revenues and increased network investment cost to accommodate surging traffic, caused by the popularity of various free messaging services,” said Choi Jin-Sung, SVP and head of SK Telecom’s Technology Strategy Office.
For instance, KaKao Talk, a mobile messaging service used by 37 million Koreans (46 million subscribers globally as of May 2012), is becoming a threat to mobile operators as it launched an mVOIP service.
In February 2012, Australian telecom operator Telstra said it would work with OTT players and grow its business.
READ MORE: Over-the-top (OTT) is likely to disturb SMS revenue of operators. Telecom operators will lose $54 billion in SMS revenue by 2016 due to social messaging services on smartphones. The $54 billion SMS revenue loss is more than double the $23 billion operators are expected to have lost by the end of 2012, according to Ovum.
Operators in Europe and Asia-Pacific will be affected the most, and should be vigilant with respect to OTT messaging activity.
“Social messaging is becoming more pervasive, and operators are coming under increased pressure to drive revenues from the messaging component of their communications businesses,” said Neha Dharia, consumer telecoms analyst at Ovum.
Ovum suggests that telecom operators need to understand the impact of social messaging apps on consumer behavior, both in terms of changing communication patterns and the impact on SMS revenues, and offer services to suit.
READ MORE: In the first quarter of 2012, minutes of usage of voice per user declined significantly in North America (-5.3 percent), Asia-Pacific (-0.6 percent), and Western Europe (-0.4 percent). Mobile email and OTT mobile apps such as Whatsapp, Viber, and iMessage are impacting mobile voice usage patterns.
According to Strategy Analytics, OTT service platform vendors like Amazon Web Services, Salesforce.com and Microsoft are giving tough competition to mobile operator’s cloud services. Operators can respond to their challenges and recapture value with real time services, connected devices and connectivity management.
Telecom equipment makers are gaining from OTT space. To tap the OTT segment, ZTE launched a hardware and software solution integrating low bit rate high definition, OTT, and multi-screen convergence. ZTE claims that the solution supports OTT services on multiple screens for devices such as TV, PCs, tablets and mobile phones.
Note: TelecomLead.com’s editors have selected this item based on the impact it created on the industry and companies.
Krishna Aravind
[email protected]
