The advent of VoIP services accessible via a GPRS/3G/HSDPA or Wi-fi link originally caused consternation within the cellular industry and amongst certain European operators in particular. Now it's apparent that mobile operators have begun to view mobile VoIP as something which they can co-opt rather than a disruptive technology which threatens their existing revenue streams. Many operators are taking measures to ensure customer loyalty in the face of suppos-edly 'free' mobile calls offered by VoIP. By Tony Dennis
Rely on small business VoIP for your telecommunication needs.
The UK has provided a classic example of a clash between a VoIP newcomer, Truphone and an established operator, T-Mobile, over interconnections between their respective networks. Effectively T-Mobile was refusing to enable Truphone subscribers using VoIP over dual mode handsets to connect to its cellular subscribers.
In July 2007, Truphone gained an advantage in this dispute with an injunction forcing T-Mobile UK to interconnect with Truphone. As things stand currently, a Truphone spokesman told Mobile Europe that, "The injunction remains in force and both parties have agreed not to bring matters to trial pending the matter being considered by Ofcom (the UK comms watchdog) as a complaint/dispute." This result has been viewed as a victory for the pure-play mobile VoIP suppliers in general including others besides Truphone such as Vyke.
Skypephone
Subsequently operators' attitudes to the whole issue of mobile VoIP have softened considerably – especially after the launch of the Skypephone by 3. Guy Middleton, 3's UK spokesman, commented, "Our 3 Skypephone shows what can be achieved in a mobile environment without termination regimes. We've had to create that environment to make it possible." He claimed, "'Most operators have sought to block internet-calling services, especially on handsets with Wi-fi capabilities." This is a reference to Vodafone and Orange who removed crucial VoIP software from Nokia handsets they supplied directly to customers. Middleton continued, "3's view is very different. We see it as a means to offer our customers powerful internet communications on their mobiles and have found a way of building it into our business model."
3 believes that the threat from mobile VoIP calls being made over Wi-fi – sometimes known as wVoIP – has been exaggerated. Middleton pointed out that, "Most attempts at mobilising VoIP are based around Wi-fi. Yet the dream of universal cheap or even free Wi-fi access hasn't materialised and even when cost is ignored Wi-fi cannot compete with the reach of a 3G network. The 3 Skypephone has all of the benefits of a 3G voice connection into the network and the utility of the internet to connect to other Skype users." Significantly, Skypephone users can make free voice calls to others on the Skype network but other facilities are missing. There's no free IM [instant messaging] using the Skyephone.
However, the Skypephone changed the whole landscape for many VoIP suppliers. "Interest in mobile VoIP is really growing," Christina Sundman, CEO with Challenger Mobile, revealed. She claims that her phone had been busy ever since,3,announced its Skype deal. Sundaman argues that mobile operators have two main drivers for investigating mobile VoIP – attack and defence. On the defence side, just like any other valued added service, mobile operators don't want to get left behind if their competitors start to offer mobile VoIP. So offering mobile VoIP is seen as yet another way to retain existing customers. "It's a war out there," Christina Sundman says.
Attack and defence
Of course, mobile VoIP can also be viewed as a weapon with which to attack rival operators. Sundman claims that VoIP has even become part of European operators' push into new and emerging markets. The biggest advantage is that it enables operators to obtain revenue where they don't even have a GSM or 3G licence. Subscribers can use the Wi-fi capability of the dual mode handsets to place a call over the Net. Sundman describes this facility as being the equivalent of offering a 'virtual SIM card'. Operators don't even need to have their own IP networks to offer this facility since Challenger Mobile can host the service for them. At the time of writing, Sundman wasn't able to reveal which MVNO in the UK is already a Challenger Mobile customer because the operator hadn't finished testing. However, she hinted that this is just one of many potential customers in Europe.
3 is, of course, a pure-play mobile operator but as, Shirish Andhare, a vp for marketing with Sylantro observed, "In Europe, there are plenty of incumbent operators who have both fixed and mobile assets." One of whom, Swisscom, is already a Sylantro customer. He strongly believes that operators are looking at mobile VoIP to obtain market advantage. "They like to stay ahead of the curve," Andhare said.
The business customer
The key to success with mobile VoIP is to target business customers, in Andhare's view. "VoIP has up until now being targeted at the residential market." He believes that operators are presently taking a view that the mobile handset has become the de facto business telephone of choice. So fixed/mobile operators are looking at ways of extending ways they can offer VoIP to existing customers even if to a certain degree it means cannibalising aspects of their existing business.
One of the reasons why business users haven't been too interested in VoIP is that it has previously been sold on its monetary benefits and more specifically on total cost of ownership. "The typical business mobile warrior isn't so much worried by cost but is interested in mobile VoIP because of the convenience," Andhare said. He feels that VoIP is just the start of the trend towards IP and that businesses will want to integrate a whole range of 'value added services' besides just voice.
He argues that Business users also want to replace the traditional 'blackphone' – the desktop extension handset with a mobile handset. As soon as an employee walks out of the building her or she loses the ability to transfer calls to a colleague's extension number and can no longer put callers on hold or patch them into a conference call.
Not all VoIP is free
An important distinction which Challenger's Christina Sundman wanted to make is the difference between mobile VoIP and free calls. She believes that while most operators won't charge for mobile VoIP calls between their own subscribers in their home territories, it presents the operator with a new revenue stream from international calls. While international calls using VoIP will prove cheaper for consumers, those are calls that otherwise might not have been made by the mobile network's own subscribers.
Preventing roaming call leakage
Indeed, the key goal for Mobile2IP from Starhome is to help operators prevent leakage of roamers looking for VoIP alternatives to roaming phone costs. Starhome's solution
Enables users to make & receive mobile calls over VoIP using their existing MSISDN (Mobile Station Integrated Services Digital Network) telephone number.
This has two key benefits. Firstly it allows users to route incoming calls either to a handset or to a laptop computer – both of which are running the Mobile2IP software. Secondly, the fact that the mobile operator's branding appears on the subscribers' laptop screens only serves to strengthen customer relationships and operator brand identity, Starhome claims. "A converged [mobile and laptop] solution creates an adhesiveness between IP and mobile networks which prevents user churn to competitive technologies," commented Orly Nesher, a vp for marketing with Starhome.
Presence
Mobile2IP is based on SIP (Session Initiation Protocol) technology – otherwise known as 'Presence'. A key feature of A solution called Enrich supplied by Colibria to the Mobilkom Austria Group (MAG) is a Presence and an XDM server. The company claims this will be the bedrock on upon which innovative communication services and applications will be built. According to Matt Hooper, an executive vp for marketing with Colibria, "Those operators who have both mobile and fixed network assets have an opportunity to launch innovative service packages into the market which creatively use Presence, call routing based on availability and shared contact lists to provide a greatly enhanced user experience beyond traditional voice. When you combine VoIP with other services which use Presence such as mobile Instant Messaging (MIM), you get something potentially very compelling for users."
A strong case for offering business customers are truly 'converged' solution is made by CommuniGate. Its software aims to provide all users – no matter if they have an Apple Mac, PC or Linux computer with access to corporate data. The company's Pro Mobility Suite works with a variety of handsets, too. These range from Symbian and Windows Mobile based devices to the Sony Ericsson P900, M600 and W950 handsets; Nokia E-series devices; plus various Motorola, Palm and Treo wireless PDAs. Even the Apple iPhone can now join in. Pro provides the ability for business users to access their email messages, calendars, contacts, and tasks via a mobile operator or corporate network.
The very latest version of CommuniGate's client software, Pronto! 1.5, includes support for mobile VoIP. Crucially, it also providers operators with a content delivery client that works on any platform. So it is a tool content like ringtones, MP3s and videos to be supplied to virtually any device. "Pronto! enables carriers to sell that content, or provide it on an advertising-supported basis, and have an interface that can display all of it," claimed Jon Doyle vp of business development with CommuniGate. Perhaps the most important facet of CommuniGate's solution is that it is built around the use of browsers and Adobe's Flash product in particular. Any handset that can run Flash Lite (the mobile version of Flash) can access a CommuniGate server.
One way of viewing mobile VoIP is to see it as an integral part of the 'connected home'. According to Steve Shaw, associate vp for marketing with Kineto, mobile operators are no longer tying to contain or manage the use of VoIP across their networks. Instead, they're showing interest in what Kineto terms 'Homezone 2.0'. Homezones started with the likes of O2's Genion into Germany which was entirely cellular based. Home zones have subsequently gone through a Bluetoth and a Wi-fi stage and have now reached the femtocell which adds broadband and IP into the equation.
Kineto supplies UMA client software as well as the infrastructure/controller side that copes with any facility that GSM can offer including text messaging. Shaw says most start out just offering cheap voice but as consumers move to high speed Wi-fi (802.11g) routers, operators are beginning to offer other facilities. Kineto's most successful customer to date is Orange which is offering a UMA based service – called Unik – in Spain, Poland and the UK. Another client is Telia with installations in Denmark and Sweden
An analysis of Unik's performance by France Telecom/Orange turned up some interesting results. The service – which started in 2005 – now has over 500,000 subscribers. Research shows that these subscribers are three times less likely to churn to another network on a contract than regular customers. The company alos calims that "the negative 'repricing' aspect effect for both fixed and mobile clients is compensated by additional revenues. Indeed, the fixed line ARPU has seen a significant uplift.
Overall, the perceived threat from the likes of Skype and Vonage has diminished. "Mobile operators have come to realise that putting a Skype client on a dual mode (cellular/wi-fi) handsets is only for hardcore customers who are determined to shave a few pennies off their voice traffic bills," says Steve Shaw. "The pure-play mobile operator has started to utilise somebody else's broadband. Piggybacking while keeping the brand just like Skype and Vonage do, was not unheard off but is now becoming more mainstream."