Some like it OTT

An article in the Financial Times on 19 November about the launch of 4G services in the UK noted the view from European mobile network operators that the global decline in voice revenues would not be off-set in the short term by increased mobile data revenues.
Because while operators have been investing in upgrading their networks to support new mobile data services, over the top (OTT) mobile Voice over IP (VoIP) players have been eating into that bandwidth, without paying for access to operator infrastructure.

According to Swisscom CEO, Carsten Schloter, the introduction of communications over the internet has “rendered all local telco models subject to global competition”. This is because internet connectivity on smartphones enables OTT mobile VoIP applications to hitch a free ride on operators’ expensive new spectrum.

Market research firm, In-Stat, estimates that the total number of mobile VoIP users will reach 288m by the end of 2013. Telecoms industry analyst Ovum, meanwhile, predicts that OTT mobile VoIP apps, such as Skype and Viber, will reduce MNO’s voice revenues by $479bn by 2020.

Major advantage
In spite of the apparently bleak outlook, however, operators still have a major advantage over SIP-based OTT providers. Free SIP-based services are bandwidth hungry, rely on the availability of wi-fi networks, and do not work properly over 2G and 3G networks.

Operators, meanwhile, have carrier-grade networks, established CRM and billing platforms,  and trusted relationships with consumers. These assets, integrated with a real carrier-grade mobile VoIP platform, which works across any mobile network, allow operators to offer higher quality of service and better segmentation, providing differentiation to a number of partners within industry verticals.

The booming online dating industry is one example of a sector that could provide operators with a new market for segmented communication services. By partnering with dating site providers and offering community-based mobile VoIP services that can be optimised without loss of voice quality, and delivered over any network, including 2G, an operator can attract new b2c customers, and increase the number of minutes and messages they terminate.

What’s it worth?
The past decade has seen an explosion in the number of people using social networking and online dating sites. Match.com gained 10m members in seven years, and claims that one in five adult relationships is now kindled online. According to a recent article in the Huffington Post, the global online dating industry is currently estimated to be worth more than £2 billion.
However, a You.Gov report, conducted on behalf of German social network site, studiVZ, found that online community members are extremely wary of divulging too much information online. Maintaining privacy of addresses and telephone numbers was cited as a priority.
 
Discretion assured
By offering a white-labelled app-to-app messaging and calling service to dating site providers, operators can maintain the privacy of community members’ mobile phone numbers, while still allowing them to communicate over a carrier-grade network. Online dating sites that can offer white-labelled mobile VoIP services to their membership will have a significant differentiator.

Another plus point for operators is that most free OTT mobile VoIP services are based on SIP, which is dependent on high bandwidth availability. As a result, SIP-dialler services suffer from frequent dropped calls, high latency and jitter. For nervous online daters engaging in their first conversations with potential partners, enduring a call that frequently drops or breaks up is a highly undesirable scenario.

Proof of identity
Free social networking sites, such as Facebook and Twitter, pose a risk of members using false personas. Similarly, free OTT mobile VoIP services suffer from a lack of robust registration and customer data management. Conversely, most reputable dating sites require a paid subscription. This means that members’ identities are verified during the registration phase, using their banking details.

Operators also require proof of identity before adding subscribers to their networks. A dating site using a white-labelled mobile VoIP service adds a greater degree of assurance to its subscribers that community members have been verified.
 
Targeted advertising
By going through the registration process, subscribers to online dating sites provide important demographic information that can enable the creation of highly targeted services. A white-labelled mobile VoIP service can be used to deliver in-app advertising campaigns, offering special deals to dating site subscribers. For example, restaurant offers, hotel deals and discounts on flower delivery could be provided via the online dating site’s VoIP app, underpinned by the operator’s existing CRM system.
From the operator’s perspective, forming a partnership with a non-competing internet player provides it with access to a new audience to cross-sell other services, such as cheaper international calls and data roaming.
 
Don’t mix business with pleasure
In addition to protecting mobile numbers and providing better quality of service, a community-based VoIP app has the distinctive advantage of enabling online dating subscribers to separate their personal and business identities, while still using the same smartphone to communicate with each group of contacts. A white-labelled, carrier-grade app enables uninterrupted conversations and messaging over an app-to-app connection; from app-to-PSTN; PSTN-to-app and via push-to-talk.
 
A long-term relationship
For leading online dating companies, delivering an optimal journey throughout the service lifecycle, and protecting their customers’ private numbers and personal data is paramount to retaining and growing their subscriber base and facilitating a firm engagement with their customers.

Operators’ businesses have been built over two decades on the premise of quality of service and establishing a trusted relationship with consumers. We see a hot opportunity for operators and MVNOs (Mobile Virtual Network Operators) to offer community-based mobile VoIP apps that enable users to communicate privately with other community members and enjoy exclusive offers. This model allows for sophisticated segmentation and enables mobile marketers to engage with communities via in-app advertising, delivered as text or audio, to provide highly targeted deals and services. It could be a match made in heaven.
 
Annaïg Couget is director of sales and marketing at Horizon-Globex