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WhatsApp calling stirs operators

Bonnie Tubbs
By Bonnie Tubbs, ITWeb telecoms editor.
Johannesburg, 20 Apr 2015
OTT calling services pose a real threat to the hefty traditional voice revenue streams operators have long enjoyed.
OTT calling services pose a real threat to the hefty traditional voice revenue streams operators have long enjoyed.

SA's operators have always been on the defensive when it comes to voice over IP (VOIP) services and, with over-the-top (OTT) voice calling now more of a reality than ever, consumers can expect a reaction - which may include price differentiation or new white-label services.

This is according to analysts in response to MTN's recent announcement that it is upgrading its deep packet inspection (DPI) system. The move has raised concerns by both consumers and industry watchers alike, who question the timing of the move, which comes shortly after WhatsApp introduced its long-awaited calling feature for Android devices.

Some fear MTN plans to use DPI to identify when its data network is being used for calling applications - which have now become more of a reality than an imminent threat - to the end of either increasing charges or shaping this traffic.

However, MTN CTO Eben Albertyn says the concerns are unfounded. "MTN customers making data calls using OTT and VOIP services will be charged as per their data rate packages."

Albertyn says MTN's DPI upgrades are aimed at increasing capacity and resilience, and entail migrating data from one platform to another. "These upgrades are intended to capacitate our network to satisfy increasing data demand and traffic and to also ensure the network is of an acceptable standard and capable of satisfying the needs of customers."

Vodacom spokesperson Richard Boorman says the operator - SA's biggest by customer number - also has no plans to charge differential rates for VOIP and says DPI is nothing sinister, but rather a means for operators to "optimise traffic flows".

Telkom communications head Jacqui O'Sullivan says the company is still exploring different billing methods that could be applied to VOIP traffic on its network, adding the findings of the latest Research ICT Africa report tags the operator as having the cheapest prepaid call and SMS pricing combination on the market.

Cell C had not responded by the time of publication.

Broken promises

However, in light of recent moves by Vodacom, MTN and Cell C to up mobile prices - which until recently had been steadily coming down - many consumers have been left cynical.

World Wide Worx MD Arthur Goldstuck says it is inevitable the networks will begin charging a differential rate for calls over data, regardless of denials. "Just as they can change the terms of your contract despite it being cast in stone, they can change the terms of engagement with customers in non-contracted areas, regardless of any previous assurances."

Goldstuck says, while it may have been a case of bad timing that Vodacom announced its increased rates within hours of its global CEO declaring Vodafone was committed to reducing the cost of communications, "that was a good example of not having to stick to prior commitments".

Last month, during a visit to SA, UK-based Vodafone CEO Vittorio Colao told journalists during a Johannesburg briefing that the company at large and Vodacom SA strives to be the "Unilever of telecoms" - a company that puts its customers first and that everyone likes.

However, Goldstuck says more of a reaction can be expected from Vodacom rival MTN, as the company's CEO "has been vocal and even aggressive in his attitude towards the social networking and instant messaging players".

Futile fight

Ovum analyst Richard Hurst says MTN has been one of the most vocal in terms of its network when it comes to defence against IP-based calling services. "The latest announcement on the DPI upgrade is a message to both consumers and OTT players."

Hurst feels MTN's moves are knee-jerk reactions which - while they may offer some slight, temporary, relief in terms of stemming the revenue losses - the likely reaction will be that consumers and businesses will turn away from such services as they feel their ability to gain more has been hampered by the very network providing the service.

"MTN is attempting to create a walled garden scenario where their users are only able to use their own voice services and not that of OTT players. Perhaps a more appropriate strategy would have been to be an enabler of OTT players and seek to partner with these entities to create a better user experience."

The big fear among operators, concludes Goldstuck, is that such services will eventually replace operator-defined voice and messaging altogether, and operators will be reduced to data pipes. "[Facebook CEO] Mark Zuckerberg, in fact, told operators at Mobile World Congress in 2014 that their role should be exactly that, and the operators don't like it one bit. Differential pricing will be just one example of retaliation."

The more consumer- and business-savvy network operators will begin to either partner with OTT players or offer their own white label service, says Hurst. "The voice market is swiftly changing and voice has become largely data-based. Any move to try and stem the tide will be futile in the end."

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