Telcos have had to adapt to change arguably more than any other industry. With the advances that have been made in everyday technology use, it’s becoming harder and harder for telcos to compete with other service providers. The growth of OTT services is clearly taking a toll on telcos due to changing customer preferences.
Over-The-Top (OTT) services are services that are used on top of the basic network services you get from your provider. These services have become much more common thanks to the smartphone. Having a device with such capabilities at our reach at all times has increased communications drastically. VoIP now allows us to make cheap and even free calls and SMS’. However, recently, data has been added to the mix. This poses a threat to telcos which they have not been trying to find a solution to. Telco subscriptions do mean that your are continuously paying for these services, however, you are also not fully reaping the benefits. The danger in this case is the loss of revenue stream from telcos, which in turn makes it harder for them to compete and provide reliable service all the time.
OTT players are thus able to offer better services than telcos nowadays. These providers have continuously adjusted to changing consumer behaviours to guarantee the best service. OTT services have had a huge impact on revenues for telecom operators and that is understood by stakeholders worldwide. With the growth of OTT VoIP, the overall global telco voice revenues will drop drastically from $970.4B to $799.6B by 2020. This is mainly due to the annual growth rate of 20% of the OTT VoIP market.
In a fast-growing environment such as the one OTT providers operate in, it’s important to listen to customers’ needs and aim to satisfy them. Trends have lately been the increased need of personalization and customization. OTT providers have unique and one-of-a-kind solutions to all your needs and will provide you with the solution that best suits you. This is then more convenient for customers, which is why they are willing to pay a premium. The next trend is advancements in technology. With great advancements from GSM to LTE, OTT providers can exploit this by undercutting and providing better rates to their customers, while not compromising quality. Lastly, messaging preferences have probably permanently shifted from traditional SMS to OTT messaging services. This is primarily driven by cost and the increased usage of the smartphone.
As for Voice OTT services, they are arguably the easiest to add. The main argument for this is that they rely on IP networks and the internet to carry the calls; meaning no need to set up complicated and bulky hardware. You are also able to construct the solution you want yourself which makes it extremely user friendly.
OTT providers have come to stay, with no signs of stopping anytime soon. Now is the best time to be competing in one of the fastest growing industries.