Do current regulations prevent telcos from competing with Skype and WhatsApp? Or does the value-price relationship (no incremental cost) actually shape the fundamental competitive dynamic?
Bernardo said Brazil is looking at a new telecommunications regulatory regime, to take into account the rise of services like over the top calling apps such as Skype and WhatsApp.
Precisely what that might entail is not immediately clear. But Bernardo said “quality-of-service requirements” placed on Telefonica, Embratel and Hi prevent them from responding to over the top services.
Some might argue it doesn’t fundamentally matter whether licensed tier one telcos are allowed to provide VoIP service over the top, without the burdens of carrier voice regulations. The issue is not so much quality of service rules but the business model.
Though “no incremental cost” is a major advantage of OTT messaging, compared to carrier text messaging, value is the other attraction. People can do things on messaging platforms they cannot do when using short message services.
Still, it is not clear whether relaxing rules can help incumbent telcos compete with over the top messaging and voice services. Telcos simply have cost structures too high to support viable OTT messaging and voice, even if they wanted to do so.
McKinsey analysts believe telcos can slow the incursion of OTT apps, but at the cost of providing affordable texting options.
Booz and Company analysts have argued telcos really cannot compete directly with OTT applications. Others have argued for partnering with OTT providers.
A few telcos have tried to launch their own OTT apps. Generally speaking, the argument for effective telco competition with OTT apps is to add value. Whether enough value can be added to change the value-price relationship is the question.
OTT apps continue to add functionality and value as well, the most recent example being WhatsApp announcing it will add voice calling in 2014.
And some might argue best course is to harvest voice and text messaging revenues, as has been done in the past in the communications business when a legacy revenue source faces decline.
The point is that it isn’t clear that relaxing regulations on carriers who want to offer over the top voice or messaging is a fundamental matter.
Antivirus software is not enough. Apex Technology Services used its decades of IT and cybersecurity
experience to create budget-friendly network security packages every company needs.
Please take a moment to fill out your information so we can contact you directly regarding your request.
iGaming is one of the fastest growing industries on the internet. For those who may not be aware, iGaming refers to online casinos, online slots, poke…
It is easy to get lost in all the new phone releases when multiple happen yearly. Consequently, most new functions go unnoticed because people do not …
Embarking on the journey to bring a new product into the marketplace is an exhilarating adventure that blends the thrill of innovation with the meticu…
MySQL on AWS is the deployment of the MySQL database system on Amazon Web Services (AWS) cloud platform. MySQL is one of the most popular open-source …
Responsive images are a fundamental component in responsive web design. They adapt to the size of the user's screen, delivering the best user experien…