The European Commission Vice President, Neelie Kroes, has delivered a farewell speech to the members of the European Telecommunications Network Operators’ Association (ETNO); in which she urged telcos to embrace over-the-top (OTT) players, and stated her dream for the European telecommunications sector after the current Commission’s tenure ends at the end of October.
According to a report published by Juniper Research operators are set to lose $14 billion worth of voice and messaging traffic to OTTs such as WhatsApp, Facebook and Skype in 2014 alone. The report claimed operators in many markets, including the UK, Italy and Spain, have seen 60% decrease in mobile voice revenues in five years.
During a speech this summer, Google executive Tim Carter declared that operators simply can’t afford to innovate, claiming that that the “luxury” of digital innovation is now the sole preserve of the rich (i.e. Google) and entrepreneurs with little to lose. But is this really true?
Mobile comms consultancy Northstream reckons European telcos are missing out on over €2 billion in potential profits that could come from effectively partnering with Internet players generally referred to as OTTs.
The lines between network operator and OTT communications provider blurred further this week as Telefónica O2 UK partnered with cloud-based messaging and voice software developer Nexmo. Nexmo writes the underlying APIs that power the likes of Viber, Line and Kakao Talk.
Major OTT players like WhatsApp, Facebook Messenger and Viber have become choice messaging services for consumers wanting low cost, global communication; creating an ecosystem where operators need to seriously consider which type of partnership or OTT integration models will enable them to drive revenue and sustain their business long term.
The birth of mobile, followed by smartphones and then tablets, which provided telecoms providers with their biggest boom in a century, now poses a threat to their growth and stability. This threat comes from the latest development in the smartphone story: communication apps.
Revenue and profit sources of mobile and fixed-line network providers are under much more pressure than originally thought. Users are radically changing their behaviour, over-the-top (OTT) offers are highly competitive, and, most of all, non-future proof toxic price models are in place.
Facebook-owned mobile messaging service WhatsApp has struck its fourth carrier deal in India, extending its services further into the territory through a contract with Bharti Airtel.
OTT communications provider Skype, a subsidiary of Microsoft, has announced that it will make its group video calling service available to all users, free of charge.
Facebook has been warned it risks alienating users as it seeks to grow the reach of its Facebook Messenger app as a platform for communications, content and commerce. The company has decided to remove its mobile app’s messaging capabilities in some European markets so that users have to download Facebook Messenger instead.
The co-founder and CEO of video service Netflix, Reed Hastings, has said that sharing costs with internet services providers “makes no sense” for the firm.
“The 2nd China Carriers Forum” organized by Genesis Resourcing Consulting China and China Mobile Communication Association, to be held on 20-21 March. Bei Jing gathered together worldwide leading carriers including Orange, Company TTK, Etisalat, Deutschen Telekom, China Mobile, China Telcom, China Unicom etc.
Respondents to the Telecoms.com Industry Survey 2014 reaffirmed the previous year’s enthusiasm for the idea of partnership between OTT players and operators, with 92 per cent believing there is value in such collaboration. But this year the key benefits were pinpointed as improved customer retention and a competitive advantage.
Consulting and outsourcing firm Capgemini has unveiled plans to bring a white label Joyn server to market. The rich messaging server was developed in collaboration with Orange and will enable mobile operators to brand and embed their own, out of the box version of the rich messaging service onto handsets, providing consumers with an alternative to over the top (OTT) applications.
In what some have billed the largest startup acquisition in web history, Facebook on Wednesday agreed to acquire cloud-based over the top mobile messaging firm WhatsApp for an eye watering $19bn.
Japanese conglomerate Rakuten, owner of online retailer Play.com, has acquired popular over the top messaging and VoIP developer Viber for $900m.
The most serious challenge mobile operators face over the next five years is the competitive threat from OTT players, according to overall respondents to the Telecoms.com Intelligence Industry Survey 2014. Almost 50 per cent of respondents rating the OTT threat a six or seven on a one-to-seven scale of severity. But the operator repondents themselves when broken out, however, judged regulatory pressure on pricing to be the biggest threat, with almost 60 per cent of operator respondents giving this a high rating for severity.
Although the telecoms industry remains largely enthusiastic about the prospect of operators partnering with Over The Top service providers, several challenges still threaten to derail such partnerships, the Telecoms.com Intelligence Industry Survey 2014 has revealed.
Verizon Communications on Tuesday agreed to acquire Intel Media, a business division dedicated to the development of Cloud TV products and services. The US carrier will incorporate the Intel-developed technologies into its next-generation video services through the Verizon FiOS fibre optic network and over the top to any device, including via LTE.