Wednesday, February 26, 2014

WhatsApp: a threat for telecom operators


WhatsApp services in voice could be a major threat to mobile phone operators, but it is too early to come to any conclusion on the impact of such services of messaging service providers, said Jon Fredrik Baksaas, CEO at Norwegian telecom firm Telenor.
"This is an enormous threat, and an enormous possibility," he told reporters at a news conference on the sidelines of the Mobile World Congress event. "Voice over IP in the mobile space is a more complex online service that needs to be online. I wish them good luck in that," added Baksaas, who is also the chairman of GSMA, the global industry body for GSM mobile operators.
His comments come a day after popular instant messaging app, WhatsApp, was acquired by Facebook for about $19 billion. He said it will add voice services to its messaging platform in the second quarter of 2014.
Mobile operators fear that the success of any such voice services over the internet can severely dent voice revenue, which still account for majority of the overall revenue pie for a telecom service provider.
But Baksaas pointed out that voice-over-internet services will face enormous challenges in connectivity. "If their (WhatsApp's) overall revenue stream shifts to that layer (internet), the connectivity part of that equation is at risk, and without connectivity, you can just forget realising everything on the IP (internet protocol) space," Baksaas said. "This arena is only just started to be debated. So, how it will play out remains to be seen," he said.

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