VoIP Over Wi-Fi will Pose an Added Headache

Mobile operators must convert the threat Wi-Fi and VoIP poses to roaming revenues into an opportunity by incorporating the technologies into their strategies. This is one finding of the latest study, "Mobile roaming 2006-2011: Increasing usage and revenue to counter regulatory burdens," published by industry analyst firm visiongain. By adding Wi-Fi capabilities to their offerings, mobile operators will be able to capture a growing market currently targeted at mobile roaming subscribers.

The study also found that the threat of EU regulations will continue to drive roaming prices down in the EU. This trend is likely to occur globally as operators seek to increase roaming usage as a boost to declining voice revenues. Visiongain believes that price reductions by operators will succeed in driving usage, allowing operators to tap into the 95% of subscribers who currently do not use roaming services whilst abroad.

VoIP through Wi-Fi will become an increasingly attractive alternative to mobile voice calls whilst roaming due to the disparity in price. Visiongain found that a typical voice call whilst roaming over Wi-Fi costs $0.02 per minute, compared with a typical cost of $1.25 per minute through mobile. The increase in Wi-Fi hotspots world-wide is creating more opportunity for travellers to utilise VoIP services, therefore threatening mobile roaming revenues. In addition, visiongain believes that Nokia's entry into the Wi-Fi market with its converged GSM / Wi-Fi handset, the 6136, is significant because it legitimises the technology's entry into the mobile handset market.

Several companies are already using the price difference between VoIP and mobile as a marketable advantage between the two technologies. For example, RebTel specifically targets the high price of mobile roaming voice calls with its international calling options.

"Roaming provides a significant proportion of operator revenues - up to 17%," comments the report's lead report author and visiongain analyst Adam Walkden. "To protect these revenues, it is important that operators take the threat of VoIP seriously. The difference in cost of a roaming call through mobile and VoIP is significant enough to attract the attention of frequent business travellers, the main staple of roaming revenues. Unless operators react to this threat, either by embracing VoIP or reducing call charges significantly, roaming revenues will decline."

However, operators should use VoIP as an opportunity to increase roaming revenues. "The introduction of handsets such as the Nokia 6136 puts the power back with the operators," continues Walkden. "If they can incorporate VoIP into their existing strategies, they will increase revenues and retain the custom of the important frequent business travellers segment."

The report examines the current mobile roaming market, and provides forecasts through to 2011 for roaming subscribers and data and voice revenues, amongst others. The study analyses the roaming strategies of major operators and provides price comparisons for these operators. The report also looks at roaming solutions for mobile operators, and how they can help operators introduce differentiated and value-added roaming services.

Posted on Jun 29, 2006  Reviews | Share |  Digg
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