Joyn and RCS 5.0 show off their potential in the US with MetroPCS

We wrote recently about how the timing might be right for Rich Communication Services (RCS) after all. And as if to reinforce the point, one of the leading operators in the US chose the same day as our post to announce the commercial launch of an RCS offering on its network.

Just like the big five operators in Europe, MetroPCS will deliver RCS under the GSMA-licensed joyn brand. It offers more than the basic joyn, though: besides the usual mix of free, integrated instant messaging and chat and simplified content sharing, MetroPCS adds WiFi VoIP and Video calling. The timetable is also familiar from previous RCS unveilings, with the joyn app initially available for one high-end smartphone (in this case, Samsung’s Galaxy Attain) before roll-out of additional RCS-enabled devices next year and native support for joyn services to follow.

But there are more differences  this time – the MetroPCS deployment represents the world's first commercial launch of RCS on an LTE network. The operator will also be using as a baseline the GSMA RCS 5.0 standard, which offers a larger feature set than most existing joyn roll-outs. This makes us wonder whether MetroPCS will be looking to deliver differentiated services along with the base service interoperability that lies at the heart of joyn.

And something else is downright unusual. The industry response so far has been almost universally positive, with the normally sober Fierce Wireless even calling the technology “cutting edge”. Compared with the resigned sighs of “too little, too late” that echo around Europe following an RCS launch anywhere in the continent, the willingness of North America to judge RCS on its own merits – of which there are plenty – is really rather refreshing.

Of course, an RCS announcement just wouldn’t be the same without at least one dissenting voice, and in the case of MetroPCS it comes from an unexpected quarter. T-Mobile USA – who expect to close a merger with MetroPCS sometime in the first half of 2013 – remain distinctly lukewarm on the potential of RCS, to judge by recent comments from company CTO Neville Ray.

While Ray said “there are elements of the RCS offering that make sense,” he instead said he sees the rich application environment in the US already driving many of the services that RCS is aiming to populate.

That may be true.  But there is also little to suggest a lack of space in the market for a fully interoperable communications service that works on any device, on any network, with anyone in a subscriber’s mobile address book. Hopefully a post-merger MetroPCS will get a chance to show just why the industry in North America is right to be excited.

Sustained operator push is setting the stage for Joyn and RCSe success

Could RCSe work after all?

It represents the biggest counter-offensive from operators so far in their battle with OTT players. Yet critics want to know just how RCSe will compete with OTT services, whether it has the required reach, and most pointedly, if it can move fast enough.

Based on a specification put forward by some of the biggest operators in the business and backed up by the GSMA, it promises subscribers IM chat, video and file sharing services across any device, on any network, with anyone in their mobile address book.

Deutsche Telekom, Orange, Telecom Italia, Telefonica, and Vodafone have all committed to rolling out RCSe under the joyn brandname. And if they get it right, the superior user experience served up by RCSe can help them start clawing back some of the traffic lost to OTT offerings.

That’s the theory, anyway. Opinions are split on whether it’ll actually work – detractors point to the enormous popularity of services like Skype, the daunting task of getting RCSe on as many devices as possible, and the fact that the GSMA has estimated it could take up to three years before the service is globally available.

Tough questions, certainly. But what if the operators have the answers?

Because it’s still early days for RCSe, with joyn only announced at Mobile World Congress in February. And there are already signs that momentum is slowly building in the operators’ favor. Faced with the prospect of being locked out of operator portfolios if they don’t cooperate, nine of the top ten handset manufacturers have stated their commitment to supporting RCSe on their products.

The single hold-out might be a big name – Apple, no less – but Deutsche Telekom’s Kobus Smit recently opined that as joyn is intended to be a core communications service, Apple’s continued non-participation may become a cause of dissatisfaction for iPhone users.

Roll-out hasn’t been slow, either. Telefonica and Vodafone Spain launched joyn in June, followed by Vodafone Germany in August. And when it comes to the all-important user experience, opinion might just be starting to swing away from the OTT competition. Only last week, one report described RCSe as the best of both worlds, combining the functionality of OTT services with the reliability of operator offerings, and Gabriel Brown of Heavy Reading told us recently that there is a need for reliable, secure, rich communication services – and that this is exactly what operators do well.

But perhaps the most telling indicator of RCSe’s potential comes from a familiar source. We’ve written before about South Korea as a bellweather for communication services trends, and the evidence suggests that interoperable, operator-based IM services have certainly shaken things up in the Land of the Morning Calm.

Network traffic increased a staggering 100 times following the launch of an IM service by the country’s three major operators in March 2009, while the number of users grew 54 times. The operators also discovered that heavy SMS users continued to text at the same levels, and simply used IM to communicate even more.

So there you go. RCSe may not be too little, too late. It may be just on time. 

Is VoLTE poised to be a platform for innovation?

Now we’ll see what Voice over LTE can do.

The service known as VoLTE recently went live in South Korea on both the SK Telecom and LG U+ networks, as well as in one market for MetroPCS in the US.

And LTE also continues to spread fast, with the GSA predicting there will be 195 LTE networks in 72 countries by end of 2013 (up from 159 networks in 68 countries at the end of 2012).

And if operators truly want voice to work in this new LTE environment – if they want to give their users a good experience – they will need VoLTE, which gives them the opportunity to provide telecom-grade services to compete against the likes of Skype.

It’s not a surprise that South Korea is the leading VoLTE market.  We examined the country in May and found it on the cutting edge of most telecom trends, from smartphone adoption to the OTT challenge to operators.

We talked to Gabriel Brown, of Heavy Reading, to get some insight into the Korean VoLTE launch. He also said Korea – with its early LTE adoption – was a logical starting point for VoLTE.  VoLTE requires good LTE coverage and ideally would be supported by multiple operators. Korea has that.

But there is also national pride at stake.

“It is also an opportunity for Korea and the Korean telecom industry to demonstrate their prowess globally,” he said. “By being first, they can show their expertise internationally.”

But what about the service itself? In an interview with Telecom Asia, Ian Koh of Ericsson, makes a compelling case for the benefits of fast call connections with VoLTE.

Of course, the most crucial role for VoLTE is as the platform for new services like HD voice and video calling. And FierceWireless says the proposed MetroPCS merger with T-Mobile could spur VoLTE innovation in the US, even though MetroPCS is not yet marketing the service and says it will take four to six months before they have VoLTE up and running in all their markets.

Brown, of Heavy Reading, says that while there hasn’t been huge demand for VoLTE yet, there is “a need for reliable, secure, rich communication services.”

That is exactly what telecom does well, he says:

Even if consumers are not aware, in the industry there has been enough development for us to come to the conclusion that more operators will launch services in 2013, and it will become more mainstream from 2015 and onward.

So what do you think?  Should operators make VoLTE a priority as they roll out LTE?

Can Apple and the iPhone 5 drive HD Voice and VoLTE?

You can always count on Apple to bring a technology into the mainstream discussion. And the launch of the iPhone 5 has people talking about all sorts of formerly telecom or ICT-specific subjects – mapping technology, bandwidth for video calling, LTE spectrum in Europe, and … HD voice.

The new iPhone supports HD voice, and the service will be supported by more than 20 operators worldwide and will be supported on both GSM/HSPA and LTE networks.

From the Verge:

An iPhone, which will undoubtedly sell tens of millions of units, could be just the catalyst that (HD voice) needed to gain widespread acceptance.

HD voice had already been gaining momentum this year, to the point that Doug Mohney of HD Voice News has said 2012 could be “the year” for HD voice, at least in Europe. And, at least in Australia, where Telstra will support HD voice, the reviews are starting to come in, and they are good.

There is only one hang up in all this good iPhone buzz – HD voice will not be supported in the US, even by Sprint, which offers HD voice service. The problem is that Sprint runs its HD voice service using a different technology than the worldwide standard. So there are lots of articles with headlines like this: Why iPhone 5's Support For HD voice Will Mean Nothing To U.S. Users.

This confusion reflects the benefits of sticking to standards, but in the end any publicity is often good publicity. Most consumers in the US had never heard of HD voice before last week. Now more of them have, and they might perceive it as a cool feature they want. (Plus, it will be available on two networks in neighboring Canada).

Another silver lining is that Verizon, AT&T and T-Mobile seem to be focused on what PC Magazine calls “the real future” of HD voice, which is over Voice over LTE (VoLTE).

The new iPhone will also give VoLTE an indirect boost, as it drives LTE subscriptions, with Verizon in the US particularly looking to leverage its LTE network to attract iPhone users. In turn, this can only help VoLTE gain traction. And VoLTE opens up a lot of business possibilities for operators from video calling to chat to content sharing.

In the following video, Apple praises LTE and video calling, albeit with its own OTT system, FaceTime.

Previously, FaceTime could be used only over WiFi. Now it has gone cellular. Again in the US, AT&T is getting criticized by consumers and net neutrality advocates for only allowing cellular FaceTime usage for subscribers to new shared data plans.

At FierceWireless, Tammy Parker suggests that AT&T could charge for FaceTime usage by the minute. But she also wonders if the company is looking for a showdown over net neutrality.

So what’s the big picture here? We see Apple focusing on making voice calls better, through HD voice and an additional microphone, as well as prioritizing video calling (even if OTT). One of Apple’s strengths is its laser-like focus on consumer needs, rather than just the latest technology. Apple is not going to bother with features that don’t please their customers, and it is clear Apple thinks voice is worth investing in.

Welcome to the speedup: VoLTE, Joyn and Tu Me push back against rising OTT players

We’re back from our summer break here at the Voice on Telecom.  And though we were gone for only two months, it seems that all the trends we’ve been examining since last October are now on fast forward.

On one hand, voice and SMS are under ever-increasing price pressure, at least in places like the US and Europe. (Though let’s not forget that huge swathes of the developing world are just getting connected now, and most operators in all markets will see huge voice and SMS revenues for decades to come).  The clearest example is in the US, where AT&T has just come out with its shared data plans (Verizon did the same earlier in the year). This sparked a net neutrality debate, as AT&T will only allow FaceTime cellular access on the new iPhone to “share plan” customers.

What caused no fuss at all in the media was the fact that both the Verizon and AT&T plans include unlimited voice and SMS.  At the same time, WhatsApp, the OTT messaging company, now sends or receives more than 10 billion messages a day, just months after it hit 1 billion messages. According to a report from mobileSquared, OTT services are affecting traffic for almost three-quarters of operators, link to the whitepaper a big jump from 2011.

But there is lots of good news too.  MetroPCS in the US has launched Voice over LTE, as have two operators in South Korea, SK Telecom and LGU+. This has real potential to kick start video calling and allow developers to expand voice offerings as the VoLTE community expands, and perhaps in the long runs as possible frustration over FaceTime and other OTT video services grows. In Korea, the two operators are branding VoLTE differently but also offering a wider range of VoLTE services, like HD Voice. Both companies also promised to unveil more VoLTE-capable smartphones as the year goes on.

The GSMA-led Joyn initiative also gained momentum with its recent launch by Vodafone in Germany. With Joyn – a suite of features such as instant messaging and video calling based on IMS – up and running in Spain and Germany, there is now a real opportunity for operators to prove its value in competition against the OTT competition.

In its report, mobileSquared says that RCS has real potential as a long-term answer. But it will take time to get enough people in the Joyn community – both through operator interoperability and the widespread rollout of Joyn-enabled handsets.

So what can help bridge the gap? Maybe Telco-OTT efforts like Telefónica’s Tu Me. When we wrote about this pure OTT play, it quickly became our most-read post ever. And as of August, the service had 600,000 users, with growing bases in India and the US, where Telefónica is not present.

Plus, Telefónica only recently started marketing Tu Me with this slick 60-second ad and a revamped Facebook page with more than 131,000 “likes.”

Telefónica Digital head Matthew Key said in July that TuMe served several purposes, from retaining customers leaving for OTT services to attracting users in places like the US. The group has also signed deals with Facebook, Google, Microsoft and Research in Motion to enable direct-to-bill payments, something we said last December that operators should consider.

In short, we are seeing disruption in real time. And while this is often scary to incumbents, we want to keep repeating our core message: there is real opportunity here for operators. But they need to act now before the window closes.

How mobile gaming is key to killer content and more revenue in a commoditized telecom world

A few months ago, we said that better latency and quality of service could be the keys to making mobile gaming a better – and more lucrative – experience for gamers, developers and operators.

Those are important technical steps. But let’s also look at the business models for selling new and improved mobile gaming.  How will gaming set an operator’s or other company’s content offering apart from the competition?

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If many telecom services are becoming commoditized, content – in the form of things like apps, games and music – will become even more important to both reaching new customers and keeping old ones. Within gaming, the transition to mobile will be based on continuous revenue streams that can be easily developed by either telco, device maker or game developer.

In-game revenue can be either subscription or single purchase, and the business model is also flexible in that any of the three major players can offer the game or upgraded services within the game.

But to make this work, you need great content. Over the long run, people are not going to pay for small games. A game like Order of Chaos is nice on mobile, but if it’s played on a network with built-in voice, it can be a great game that draws in users. Same goes for the highly anticipated new multiplayer version of ShadowGun by MadFinger.  

This goes for more than just first-person shooter games too.  Check out Coventry University in the UK and its Serious Games Institute, with up to 25,000 online students.

It’s also important to realize that there is space in the market outside of Apple and Google. The Japanese game portal Gree is immensely popular worldwide and just launched in beta a tool for iOS and Android. Sony has a series of content offerings, from games to books, and Cricket in the US has its Muve Music plan. Also in Japan, NTT DoCoMo increased its stake in Tower Records Japan in order to provide better music content.

Perhaps most prominently, Samsung just unveiled its own iTunes rival with MusicHub.  Killer content is obviously central to Samsung’s drive to take market share in tablet (and phablets) away from Apple.

Customer loyalty is crucial to build a continuous revenue stream. This can be incredibly hard to build, but, if it happens, there is the potential for years of loyalty and a foothold in a disruptive future.

The future of voice does not have to be dark - We'll be back in the fall to keep the discussion going

We’re taking a summer break here at the Voice on Telecom. We’ll be offline for July and August but will return in September. Things are moving so fast in the area we focus on – the future of voice, SMS and person-to-person communications – that we’re already excited to take in what happens this summer and look ahead to the fall and winter.

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We’ve been writing this blog and been on Twitter since October.  In that time we’ve tried to reach across the whole spectrum, from four posts on gaming to analysis of Telefonica as a leader in innovation to our takes on new business models, the viability of OTT players financially, innovation in Africa, the Chinese New Year and South Korea, among many other subjects.

What’s had the most buzz?  VoLTE, Joyn/RCS and Telefonica’s Tu ME app. It’s fun that all three of those subjects are about looking forward, rather than dwelling on a gloomy financial outlook.

It’s remarkable how much has changed too in our short time online. We’ve seen the launch of Joyn, Rogers One Number and Tu Me as operators go “Telco-OTT”.  And there is a real sense of innovation and urgency among operators, including openness to finding new ways to make money off of voice and texting channels.  On this level, we’ve examined HTML5, WebRTC and in-web and in-game voice solutions.

It’s a broad, kind of vague, but fascinating topic we’re examining together.  So we hope you’ll come back in the fall and continue the discussion with us.