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May 20, 2015

Can OTT Kill VoLTE or Voice-Charging?

When Serge Lachapelle of Google spoke at the WebRTC Conference and Expo last week, the discussion was very straightforward about where Google was driving WebRTC. They were improving the codecs to the point where the metrics would make the OTT solution without any hardware support better than the optimized voice over LTE [VoLTE] supported in the hardware.

The implications were that developers should stay with Google and develop their solutions as if it was the Web and not the phone that mattered.  Phones that did not support WebRTC or were going to have their own versions would be isolated and marginalized. 

In other words, Google was not going to slow down its WebRTC work to accommodate ORTC, or find a way to make Apple part of the mix.  Their focus was improvement, not accommodation.

It’s pretty straightforward, but there was another front being attacked besides the West Coast computing companies.  It was to the carriers themselves: VoTT versus VoLTE has huge implications for carrier pricing.

For years the carriers have been coping with pricing model anomalies that consumers demanded but carriers could not deliver.

It started when Toms Evslin offered unlimited dialup for $19.99 a month on ATT Worldnet service. Consumers were being charged for a service that included blocking, so while they heard unlimited, they could also hear busy signals through the modems.

Then came the bundled pricing models for wireless that made measuring minutes monthly, and not by individual phone calls.  In effect this brought “unlimited” pricing to the wireless consumer.

Since those days the carriers have been struggling to find a balance between ‘n’ minutes and ‘n’ gigabytes of data.

For large carriers, packages are now unlimited voice and text with cap on data, while their prepaid brands offer unlimited everything.

The problem with Voice over the Top applications is that the carriers will not be able to distinguish voice from data. 

When that happens we should expect that pricing strategies expose carriers to another period of slamming, as consumers will be able to better directly compare the packages.

Edited by Rory J. Thompson

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