Who’s In Charge Here? Carrier Battles for Revenue Sustenance

The recognition that the right to offer a telephony service is a public trust is underlined by the existence of government agencies worldwide (such as FCC and CRTC) granting businesses the right to offer phone services. Included is a responsibility to provide access to any telephone number regardless of the underlying technology for that "last mile access". In turn, this means there is an inherent assumption that we can call any phone number from any service.

Truphone is a service that relies on WiFi connectivity for that last mile to WiFi-enabled handsets; each subscriber also obtains a phone number for what effectively amounts to a SkypeIn-type of service. For instance, the Nokia N95 and N80 provide wireless access via both the GSM and WiFi protocols. When I can get a WiFi connection, I have found Truphone to provide a high quality, easy-to-use service. At ceBit 2007 I was told to expect a new, more user-friendly version of Truphone by the summer; sounds like it is going into beta now.

There have been recent reports where Orange and Vodafone in the U.K. were crippling the WiFi feature prior to selling these handsets but they still would allow their customers to call a Truphone number from the underlying GSM wireless service even if the Truphone client could not work for outbound calls. According to several reports late last week, T-Mobile in the UK has gone one step further and blocked all calls to Truphone numbers (07978 8xxxxx) in the UK. (North American users of Truphone end up with a number in the 360 Area Code.)

GigaOm: Mobile carriers are scared of one thing: becoming dumb pipes whose only utility is to carry voice and text. And it is one of the reasons why they are fighting tooth and nail with the mobile VoIP providers, using all sorts of tactics to make mobile VoIP a non-starter.

VoIP Watch (Andy): No, this means to me that we are seeing one more example of where the old guard is seeking to protect their turf and aiming to use every dirty trick in the book to keep their head counts and make their numbers. That is make their numbers work only to their own benefit.

SaundersLog: My prediction? As painful as this is for Truphone, they will ultimately prevail. Logically applications and pipes are separate, and open markets demand interoperability.

Smith on VoIP: Like it or not, mobile Internet access is still treated and viewed differently than regular Internet access. As I have stated before, the future of mobile VoIP lies in the hands of the cellular carriers. The cellular network is still considered “their network”. If they would like to ban the use of certain applications (remember VoIP is just another IP application?) on their network, then they are going to do it…and get away with it.One can not expect any business to let a competitor leverage their infrastructure in order to “steal” their customers.

Jon Arnold: At this point in time – as good as Truphone’s offering is – and it’s great – a full house beats a pair of 10s – which is about how this hand looks to me. T-Mobile will win this hand, but if Truphone can stay in the game long enough, things will go their way. Until the mobile carriers feel a lot more pain, the Truphones of the world – and there are a few – will have a tough go.

That’s why it’s so important for anyone following this space to be supportive and remind anyone who’s listening that history repeats itself. What happened with landline VoIP will happen in the wireless world, and solutions like Truphone are the enablers. If they can find a way to hang in long enough, their turn will come.

My comments:

1. The Canadian Hotspot Network (Rogers, Bell, Telus) does not recognize the browser on the Nokia N-Series phones, that’s a pretty effective block on WiFi access to Truphone. And a way to cut revenue since this is a paid service. (It does work with my Nokia N800 Internet Tablet but I’m still waiting for the long promised Skype for N800.)
2. Until mobile platforms have the resources to handle VoIP processing, 3G becomes widely available (to remove VoIP latency issues associated with 2.xG GSM) and we have unlimited data plans (which are not available at this time in Canada), we are a long way from having VoIP become a threat to GSM services.
3. The overall reliability and scalability of WiFi networks has yet to be proven. When I go to conferences and find a gaggle of WiFi connections I know I’ll not get a sustainable connection. (One single high bandwidth WiFi network at eBay DevCon last week was a blessing.)

So it will be interesting to watch while this battle continues on both the technology and business fronts. The ultimate winner will be the protocols and technology that provide robust, scalable reliable service while minimizing user costs yet keeping it simple to make a call (no call back services, please). In the meantime we will pay a penalty while the Neanderthals try to sustain their drowning legacy business models as long as they can. And I’ll continue to use Truphone at WiFi connections and IM+ for Skype Software and/or Mobivox from my Blackberry whenever feasible. At least Rogers still gets their $0.95/minute when I am roaming in the U.S.and using one of the latter two.

Tags: WiFi, Truphone, T-Mobile, VoIP Wireless, Mobile VoIP

Powered by Qumana