People are talking across borders more and more. But the minutes carried the old-fashioned way by telecom operators are on a downward trajectory. It won’t be long before conventional calling will go the way of the telegram. Telcos terminated 547 billion minutes of international traffic in 2013, and Skype plus carrier traffic totaled 761 billion minutes. If we assume that total international (carrier plus OTT) traffic has continued to grow at a relatively modest 13 percent annually since 2013, the combined volume of international traffic would have reached 1.
Government dictates the rate of international calls being terminated in Bangladesh. And it is always way above the hyper-competitive international wholesale voice rate. The regulator also takes away 40 per cent of the gross international revenue. Both the elements have been strongly incentivizing illegal bypass. Moreover, the international gateway (IGW) operators have been allowed to form a cartel named International Gateway Operators Forum (IOF).
The Skype-to-Skype international traffic has grown by 36% in 2013 to 214 billion minutes, according to new data from TeleGeography. International telephone traffic from fixed and mobile phones continues to grow as well, increasing an estimated 7% in 2013, to 547 billion minutes. While the volume of international telephone traffic remains far larger than international Skype traffic, Skype’s minutes are growing much more rapidly. Skype added approximately 54 billion minutes of international traffic in 2013, 50 percent more than the combined international volume growth of every telco in the world. Given these immense traffic volumes, it’s difficult not to conclude that at least some of Skype’s growth is coming at the expense of traditional carriers.
China Mobile has unfolded its suits of applications to combat the OTT players like Skype, Line, Whatspp and WeChat. Its mobile app called “Jego” is now available for iOS and Android devices. It offers free VoIP, SMS, push-to-talk voice messages, photo sharing, video calling, and other services. Dereck Li, business development manager of China Mobile’s international unit, said the new service targets international users and aims to compete with Microsoft-owned Skype in the IDD and video calling markets. For instance, Skype pay-as-you-go calls to China cost around $0.
Viber, the mobile OTT Young Turk, has invaded the turf of Skype with 200 million users. Taking completely opposite route of Skype, the startup has now launched Viber 3 version desktop application with video calls. It will enable video calls for mobile followed by group videoconferencing in the future to cause further bleeding of Skype. Viber has also beefed up its Android and iOS apps, while introducing support for eight new languages (reaching a total of 27), the company said in a press release. Meanwhile, Viber’s meteoric rise will further complicate the US government’s desperation to “wiretap people who communicate using the Internet rather than by traditional phone services.
Many of the millions of expatriate workers living in the Gulf are separated from their families. They need to keep in touch. They need to talk. But the cheapest way of the talking has been blocked so far in Dubai. But things change.
The Saudi regulator is pressuring operators to crack down on Skype and similar OTT applications. It affects both Saudis and the many expatriate workers who live there. This will require deep packet inspection and some serious interventions in the data streams. Saudi students on scholarships who use the Skype video application to contact their parents are also disappointed. “I really don’t understand what they mean by monitoring.
“Only five years after its launch, Skype has emerged as the largest provider of cross-border voice communications in the world,” said TeleGeography in 2009. Today Skype is barely a 10-year old. Yet, its year-on-year increase of 51 billion minutes in 2012 is more than twice the collective increase achieved by all international carriers worldwide. International telephone traffic grew 5% in 2012, to 490 billion minutes and cross-border Skype-to-Skype voice and video traffic grew 44 per cent to reach 167 billion minutes. International migration, the rapid uptake of mobile phones in developing countries, and steady reductions in international call prices—especially in the form of flat-rate (and even free) calling plans—have contributed to traffic increases.
After forking out the carriers’ revenue, Skype has launched a business solution for the small entrepreneurs. Skype in the workspace (SITW) will help small businesses to market their products and services and build stronger connections. “Given the number of small companies that use Skype as a communications tool and the number of people that use Skype — more than 280 million connected users per month — the company may be on to something,” said Heather Clancy in ZDnet. Companies can post invitations on SITW to potential customers and partners interested in learning more about their business via Skype sessions. “Users can also share their SITW actions on their Facebook, LinkedIn and Twitter accounts,” according to PC World.
The acquisition of Skype by Microsoft was a big story. So was Nokia’s tie-up with Microsoft. But now comes the question of how to realize the synergies. Good piece in the NYT. Stephen Elop, the chief executive of Nokia, a maker of Windows Phones, told an audience at a recent conference that “the feedback from operators is they don’t like Skype” because its cheap and free phone calls can steal revenue from traditional phone businesses.
The awaited end of rapacious money making from international calls is nigh, according to Telegeography. International long distance traffic growth is slowing rapidly. According to new data from TeleGeography, international long distance traffic grew four percent in 2011, to 438 billion minutes. This growth rate was less than one-third of the industry’s long-run historical average of 13 percent annual growth. Because telcos must rely on strong volume growth to offset inevitable price declines, slowing traffic growth is making life ever more difficult for international service providers.
The language on ICTs in the 2012 Sri Lanka budget (paras 50-53) is pretty vague. Basically, LKR 500 million will be added to efforts to provide IT education and all government departments and agencies will have to work with the ICT Agency when they introduce IT into their systems. And, there are plans to set up a technology city in Hambantota that will hopefully attract IT and ITES firms there. But the really good stuff is in Para 53. The Telecommunications Regulatory Commission will implement policies and strategies to encourage telecommunication companies to give priority for the development of broad-band network facilities.
How much should a teleco know about the apps you are running on your mobile? In other words, should it be able to check if you are using Skype on your mobile? According to KPN, 85 percent of the company’s customers who use a Google Android phone downloaded WhatsApp onto their handsets from last August through April. As a result, KPN’s revenue from text messaging, which had risen 8 percent in the first quarter of 2010 from a year earlier, declined 13 percent in the first quarter of this year. At a presentation to investors in London on May 10, analysts questioned where KPN had obtained the rapid adoption figures for WhatsApp.
People are trying to figure the meaning of Microsoft buying Skype. So are we. Let the conversation begin. Wireless carriers now funnel voice and data traffic over two separate networks and charge customers accordingly. In the not-so-distant future, analysts and industry executives say, all mobile services, including text messages and voice and video calls, will travel over data networks.
That conventional voice traffic would decline on international routes was known (except to the people who came with elaborate schemes to control it). How fast was where the guessing was. Telegeography has some numbers: New data from TeleGeography show that growth in international call traffic has slumped while international traffic routed via Skype continues to accelerate. International phone traffic grew an estimated 4 percent in 2010, to 413 billion minutes, down from 5 percent growth in 2009, and a far cry from the 15 percent average growth rate achieved during the previous two decades. Where did the growth go?
Internet brings people closer, gives more opportunities and it is a sea, with different kinds of fish. Indi Samarajiva wrote in The Sunday Leader, about few Sri Lankans making a living, without actually going to a conventional office. But simply login in to internet to use Twitter, Skype, Virtual Private Networks (VPN) and so on and make a living, as well as LIVE it. Indi introduces Fahim Farook, Navin Weeraratne and Monalee Suranimala, as tech savvy fishermen in this different kind of sea. All of these characters launch their metaphorical boats from the island of Sri Lanka, off the southern coast of India, recently emerged from years of war but blessed with many English speaking, IT literate people, functional Internet infrastructure and a low cost of living.