Feature Article

January 28, 2013

HD Voice Now Offered by 61 Mobile Service Providers

The adoption of high definition voice is growing with some 61 service providers now offering HD voice services in 45 countries. The number of mobile networks supporting HD voice is 55 percent higher than a year ago, according to the GSM Association.

The GSMA argues the business case for HD voice includes customers making more calls, or longer calls. The GSMA argues that HD voice is a differentiator, and adds value and customer satisfaction. BT believes as many as a quarter of international calls will be using HD voice by about 2015.

Still, the revenue model is an issue. In most cases, HD voice is offered as an amenity or feature, not a “for fee” service, so the revenue model is indirect. Whether that will always be the case, for every mobile service provider, is the question.

One might argue that for a mobile service provider such as Verizon Wireless, which is trying to shift its customers to “Share Everything” plans, the retail packaging of HD voice is a somewhat complicated proposition, in that Verizon already has decided to offer unlimited calling as a flat fee service.

Verizon’s Share Everything plans use an unlimited domestic calling, unlimited domestic text messaging approach, with Internet bandwidth being the variable cost. Offering HD voice for no incremental cost obviously imposes some amount of cost, with no direct incremental revenue.

The current business model for HD voice is an indirect revenue model, where there is no incremental cost for use of the feature, and the value comes in the form of customer retention and customer acquisition.

That might be especially relevant in the context of over the top calling apps that can offer higher quality. In fact, given “higher quality” over the top voice, HD voice might be as much a “defensive” move, intended to allow mobile service providers to keep pace, than an “offensive” weapon intended to leapfrog ahead of competitors.

Of course, to the extent that HD voice drives higher international long distance, incremental revenue is generated, so there is some mix of defensive and offensive angles.

The GSMA says HD voice services are now commercially launched on mobile networks in Armenia, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Czech Rep., Denmark, Dominican Rep., Egypt, France, Germany, Hong Kong, India, Indonesia, Ireland, Israel, Italy, Jordan, Kenya, Luxembourg, Malaysia, Mauritius, Moldova, Netherlands, Nigeria, Philippines, Poland, Portugal, Qatar, Reunion, Romania, Russia, Serbia, Slovenia, South Korea, Spain, Switzerland, Thailand, Turkey, UAE, Uganda, UK, and the United States.

This week at ITEXPO Miami 2013, mobile service providers and industry professionals will commence to discuss current trends, such as the adoption of HD voice, and other emerging technology trends.

Edited by Brooke Neuman

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