WebRTC : Implications & Opportunities for Telcos

WebRTC – Implications & Opportunities for Telcos

Dean Bubley, Disruptive Analysis

adapted from presentation at WebRTC Expo SF, Nov 2012

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Introduction

This is adapted from a Nov 29th 2012 presentation by Dean

Bubley at the WebRTC Expo & Conference in San Francisco

It assumes a working knowledge of what WebRTC technology is,

and how it works.

If you are looking for a WebRTC introduction, check out: www.webrtcworld.com/ http://bit.ly/xUfKud http://amzn.to/TS7Adp

This presentation focuses on issues for telecom operators

To understand WebRTC implications, it is necessary to first have

a good idea of what is happening to voice comms anyway

More WebRTC detail & analysis is available from Disruptive

Analysis’ consulting services, research reports, workshops & blog

Copyright Disruptive Analysis Ltd 2012 December 2012

http://www.webrtcworld.com/

http://bit.ly/xUfKud

http://amzn.to/TS7Adp

About Disruptive Analysis

London-based analyst house & strategic consulting firm

Cross-silo, contrarian, visionary, independent

Advisor to MNOs, vendors, regulators & investors

Focus on 3G, 4G, operator strategies, VoIP, OTT, disruption

Published report on “Telco-OTT Strategies”, Feb 2012

Workshops on Future of Voice & #TelcoOTT With Martin Geddes Consulting (credited for various slides here)

Next events in London & US in H1’13 (futureofvoice.com)

Twitter @disruptivedean .

Blog: disruptivewireless.blogspot.com

To understand the impact of WebRTC on telcos, it is first important to understand their

current marketplace & trends. WebRTC is then a catalyst & accelerant


It’s all looking pretty grim anyway

Voice & SMS saturation & cannibalisation

Regulation & competitive impacts

Weak content & VAS propositions

Economic pressures

Ecosystem competition

Connecting the last unconnected

Smartphones & data growth

Better segmentation, pricing & promotion

Innovative services & enablers

Embracing & exploiting fragmentation


Basic services’ demand & pricing is falling


“It’s all those nasty OTTs’ fault!!”

STOP looking for a scapegoat

& take responsibility


Voice ≠ Telephony

• Now: 2G & 3G • Future: Smartphones & LTE

Voice

Telephony

Voice

Telephony

Video, context, sense Video

Gaming, CEBP,

surveillance, social

voice, TV voice etc

Voicemail

Conferencing

PTT


Service

e.g. Telephony

Product

e.g. Skype,

IP-PBX

Feature

e.g. Zynga IM

Function

We have seen a years-long trend for billable

“services” to drift down to ownable products,

and eventually appear as mere features of

functions of other apps or even device OSs


A telephony demand cliff?

It’s not just so-called OTT competitors, it’s apps removing the need for phone calls.

When was the last time you phoned a travel agent? Taxi apps are better than phoning


Telephony: Catastrophe imminent?

Price & revenue Demand Supply

Core question: Can data services offset the decline of voice & messaging?

Uncomfortable answer: probably not, based on recent evidence

Disruption and innovation are both inevitable

& essential, irrespective of WebRTC


Voice & messaging go in-context

Telephony and messaging is increasingly done “in-context” or

“in-app”. But in many cases, telco APIs don’t offer the right

“raw ingredients” or business model.


Peak telephony & SMS is here

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Mobile core services revenue,

indicative W Europe

BASELINE, ie excluding WebRTC Total c40% fall

from peak

Mobile telephony

SMS & today’s

mobile data services

Telephony c80%

fall from peak

Even without WebRTC, serious revenue falls are expected in basic telco services.

Given that telephony is >100 years old, it is now looking an old & creaky product

Source: Disruptive Analysis, Telco 2.0 Analysis


Personalisation is done by people

Mobile calls

SMS

MMS

Email

Mobile calls

SMS

(RCS?)

99% of personal

comms for all

use cases

Lowest common

denominator just

when needed

User-selected

portfolio:

perfect fit for

specific use

cases

+

“Ubiquitous” & standardised interoperable telco services will increasingly be used only

as lowest-common denominators, when no better app/service is available for a given

instance of communication. Everyone will curate their own service portfolio.


Fragmentation is valuable

Convergence & standards

Fragmentation & innovation

… new standardised services are neither necessary, nor sufficient.

They are irrelevant at best, and actively damaging at worst.

It will fragment “because it

can”. Consumer need for

ubiquity is over-rated


Device diversity = OTT inevitable

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1 2 3 4 5 6

# connected devices owned

Probability of all of a user’s Internet / messaging devices being on a single telco’s network

Free 3rd party WiFi

Shared data plans only a

partial response

Users will want same apps & service ID on every device – but will inevitably have

multiple telcos. This means that OTT-style services will be mandatory


Telcos already exploiting Internet

Owned & operated by mobile operators

Usable by anyone, not just subscribers

Via apps & public Internet

Telco-OTT Services


OTT-style services offer the only hope for continued

telco services growth & increased relevance

Harsh truth: Telco-OTT mandatory

• Telephony & SMS prices have peaked

• Telephony & SMS demand has peaked

• APIs, HD, Video, Bundles only delay the inevitable

• Need for new voice-based services beyond “calls”

• Too fast-evolving for new “federated” services

• Too uncertain / innovation-driven for standards


Comms

Content

Cloud

Connec-

tivity

Over 100 identified

Telco-OTT products in the

market.

Telco-OTT: more than just VoIP/RTC


Biz models may not be obvious

…. Carriers need to move away

from the obsession with

“subscriptions” with

WebRTC/OTT


WebRTC: game-changer & threat

The future?

Microsoft CU-RTC-WEB ???? In the crossfire


WebRTC is a magnifier & catalyst

Now

With WebRTC


My enemy’s enemy is my friend…. ???

“WebRTC will hurt OTTs more than Telcos!”

… & create new, better, more disruptive OTT players.

Great.

Actually, my enemy’s enemy is probably even nastier & uglier than the

current bunch. Anything that damages Skype is bad news for telcos too


Telco involvement with WebRTC

AT&T most visible

Participant in standards, eg proposing push for notifications

Developer-centric approach

Telefonica likely a major player

TokBox acquisition

Firefox OS advocacy

TUMe & other TefDig products

DT & FT at recent events

FT on W3C WG

Vodafone, Telecom Italia, SKT, Smart, China Unicom also on WG

Increasing anecdotal evidence from client interest


Multiple constituencies involved

Telco WebRTC interest

VoLTE & Telco-OTT teams

curious/worried by WebRTC

Enterprise VoIP / UC /

conferencing moving to WebRTC

Ground-up interest in

WebRTC (in labs etc)

Apps, developer & HTML5

initiatives adding WebRTC

+ Policy / broadband teams: Can we detect / block / bill for it?

Regulatory: What does this mean, how do we do 911 etc?


Overlapping universes

Telco services

Pure OTT apps

WebRTC

“Gateway into IMS” Softphones etc

Browser-based Telco-OTT Network & platform APIs


“Easy options” for Telcos+WebRTC

Charging platform

Legal requirements

Notifications

Numbers / directories

WiFi access (in theory…)

Network QoS (in theory…)

But does any of this really move the needle?


Some myths to avoid for WebRTC

Quality & QoS

Impending quali-pocalypse

Users appear to care less than expected Some high-Q use cases (eg

sales call)

Internet vs. non-Internet

Quality driven by much more than network Eg Coverage (esp for LTE)

WiFi

“Seamless connection”

HetNets

Mobile carriers are very

important or in control

The user & operator are the

only stakeholders

A quick diversion to some pet topics of mine:


Main WebRTC strategies for SPs

Extend on-net services

Turbocharge Telco-OTT

apps

Sell packaged WebRTC

services to subscriber

Enhance developer platform

Perpetuate legacy models

“Put lipstick on a pig” – eg RCS

Improves

relevance… but

revenue?

Sell genuine “new

stuff” to existing

audience

Lower

costs/complexity &

improve reach &

“virality”

Also: invest / incubate


Conclusions: WebRTC & SPs

No definitive answers yet

Makes the threats worse & the opportunities better Battle new OTTs or old ones: result is the same

Extending “reach” for poor services doesn’t help

SPs need to exploit WebRTC to create or resell

Avoid the “federation trap”

Manage diverse internal stakeholders & teams WebRTC will be pervasive across telco “domains”

Be nimble








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WebRTC : Implications & Opportunities for Telcos