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Whatsapp calling could rob telcos of STD revenue

The recent launch of voice calling on popular over-the-top  (OTT) messaging service app Whatsapp could hit the Indian mobile operators hard, denting their revenue from domestic long-distance operations, which make roughly a fifth of their topline.
So far, the impact of free calling through OTT techniques like Viber or Skype has mainly been limited to international long distance which has led to a decline in their outgoing billion minutes. Since mobile operators don?t earn much from the highly-priced international long distance (ILD) services ? less than 10% of their mobile revenue comes from ILD operation while 18-20% of the revenue is due to domestic long distance or STD ? they have largely escaped an impact.
However, it is the domestic long distance calls which are now under threat of being cannibalised through free calling apps launched by Whatsapp. Though free calling apps like Skype or Viber were always available for making domestic long distance calls, their usage, so far in this segment, has been limited. Whatsapp, which has a dominant share of the OTT market with 52% of mobile users using it, poses the threat of pulling away a large chunk of STD callers to its app.
Once the shift becomes more pronounced, the operators, who had previously taken a hit as free messaging services ate into their SMS business, would lose  a part of their NLD revenue too, and this could be a serious blow to them.
Naturally, telcos are fighting hard to bring the OTT players under some kind of regulatory regime wherein a level-playing field is created between them and the OTT players.
The Trai has brought in a consultation paper on the subject and the process of seeking industry feedback is on.
Whatsapp, which has a dominant share of OTT market with 52% of mobile users using it, poses the threat of pulling away a large chunk of STD callers (Reuters)© image Whatsapp, which has a dominant share of OTT market with 52% of mobile users using it, poses the threat of pulling away a large chunk of STD callers (Reuters)
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