Mobile Operators Starting To Embrace VoIP Applications

VoIP applications such as Vonage VoIP that run on mobile devices such as the iPad has left the mobile telephony industry in a quandary over the impact of these services on revenue, especially since VoIP continues to grow ever more popular.

Analysts Mason’s say that nearly 20 per cent of all smartphone users in the developed markets have downloaded a mobile VoIP application, and of those, 4 per cent are active users of the service.

Consumers can use applications from Vonage VoIP or Skype to make either free or inexpensive calls using WiFi or 3G, which poses a significant threat to the revenue stream of mobile operators, though most have departed from strategies designed to block these applications, and have instead chosen to embrace it.

“We have had a Skype mobile app on many of our smartphones for the past 18 months or so,” a spokeswoman for Verizon Wireless in America said.

She did not comment on the iPad Skype app specifically, but noted that “tablets are more and more popular with customers, for many different reasons, including the wide range of apps you can use on them.”

3UK has embraced the adoption of Skype on its mobile devices for many years, saying that it believes that the ability to make VoIP calls from its devices has helped the operator both attract and retain customers.

“People who use Skype the longest stay with 3,” a spokesman said. He declined to comment on the impact on revenues.

However, analysts warn that operators will need to be vigilant to avoid revenue cannibalization.

“Clearly, there is a risk that subscribers will use services provided by other companies and that some spend will migrate from operators,” said Tom Rebbeck, research director for Analysys Mason.

“However, we don’t want to exaggerate the risk,” he added. “Operators will still generate revenues from providing network access.”

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