Home North AmericaNorth America II 2014 Who will cash in on WebRTC and how?

Who will cash in on WebRTC and how?

by Administrator
Donald Culeton Mike HolleranIssue:North America II 2014
Article no.:5
Topic:Who will cash in on WebRTC and how?
Author:Donald Culeton / & Mike Holleran
Title:President & CEO/ & Director Product Management, Back Office
Organisation:IDI Billing Solutions
PDF size:244KB

About author

Donald Culeton, President and CEO
As founder and president of IDI Billing Solutions, Donald Culeton uses his depth of experience as a software engineer and his visionary outlook to direct the development of the company’s Billing as a Service solution. Under his stewardship, IDI has grown from start-up to industry leader, earning the company recognition as an Inc. Magazine 5000/500 company five times and securing numerous industry awards. Culeton was also named one of the ’25 Most Influential People in Telecom Software’ by “B/OSS Magazine” in 2011. Before establishing IDI, Culeton spent more than 25 years as a software developer and manager at some of the world’s leading telecommunications and technology innovation companies including Bell Labs, Computer Consoles (now part of Nortel Networks), Eastman Kodak Company and Frontier Communications.

Mike Holleran, Director Product Management, Back Office
Mike Holleran has served as the technology strategy leader for critical initiatives such as SOC 1 and 2, PCI compliance, and the evolution of a licensed software product to a SaaS platform. His knowledge and customer focus provide a balanced perspective on best practices for complex back office solutions. Holleran has served as a presenter on the topics of cloud in billing and OSS operations and PCI compliance for organizations such as B/OSS World and the Competitive Carriers Association.

Article abstract

WebRTC fits the standard profile of a disruptive innovation. It brings simplicity, lowered costs and lowers barriers to a market that is currently dominated by providers with large investments in their delivery model.

Charging is going to be a key component in making WebRTC-based services a moneymaker for traditional telecoms. They will have to make sure they can identify WebRTC traffic on their networks and create charging models and service plans that monetize it. Switching over to metered-based consumption pricing plans from traditional rated telecom plans will be essential.

Full Article

As WebRTC changes the game for communications, it remains to be seen who the big winners and losers will be when it comes to the bottom line. Could pay-per-use conferencing services become a thing of the past? Will WebRTC undermine the revenue streams for video chat applications like Skype? What will unified communications providers do with this new protocol and what does that mean for their revenue? Who else can expect to see a rise or fall of fortunes due to WebRTC adoption? Though questions remain, one thing is certain: service providers delivering conferencing solutions and traditional PTSN trunks should be planning on how they can take advantage of this disruptive technology and hedge against increased competition and lowered demand for their services. There is still revenue to be made with WebRTC, knowing where to find it is the key.

Who Will Cash In on WebRTC and How?

In many ways, WebRTC fits the standard profile of a disruptive innovation. It brings simplicity, lowered costs and lowers barriers to a market that is currently dominated by providers with large investments in their delivery model.

With these thoughts in mind, many are predicting that WebRTC is on the verge of being a major disruptive element in the communications market. There are still differing opinions on when this will happen, but one thing everyone agrees on is that when it does it is going to bring with it new winners and losers. The winners will be those who find a way to monetize the WebRTC revolution, the losers will be those who cling to business models that suddenly seem out of date.

Strategic companies have already started analyzing how they can profit from the potential popularity of WebRTC or, at the very least, how they will able to protect their current revenue streams. If your company is going to do the same, the best place to start is by asking yourself three critical questions:

1. How will we be impacted? What services are we providing today are in danger of being totally displaced? Which will remain but require different delivery mechanisms in order to remain relevant? What capabilities and competencies do we possess that will allow us to create new services to meet the new market demand?

2. What investments do we need to make? What are the most critical things we need to do to respond to those changes? Do we need new partners, equipment, channels, etc.?

3. How will we monetize these services? How are we going to create products and pricing for these new services? Do we have a solution that will support billing for them?

From the perspective of a billing and OSS services provider, we’ve seen how technology, pricing and service shifts have led to dramatic changes in the business of communications. From the early days of the CLEC transformation to the mobile revolution and now with today’s cloud evolution, companies have to make sure their back office keeps pace with new usage types, charging models, pricing strategies, rating schemas and more.

With this unique perspective, back office providers look at WebRTC not just as a protocol, but as a strategic communications tool that service providers may use to expand their level of service and build new lines of business. History tells us that some will make it work, others won’t. Betting on change always carries some amount of risk. For gamblers, the odds on the WebRTC game may look something like this.

Wireline providers are potentially the most impacted by the changes brought by WebRTC. On the one hand the considerable income gained from charging for phone calls flowing through their PSTN networks could be completely displaced. On the other hand, their existing enterprise service portfolios and enterprise market penetration put them in a great position to make sure they are the ones from which businesses purchase their new WebRTC services.

Revenues from supporting contact centers and providing toll-free lines are predicted to be hit especially hard. Businesses are expected to trade-in their bundles of inbound voice circuits in favor of a button on their website that can instantly create a WebRTC call between the customer and a service representative. More drastic predictions question the future need for phone numbers themselves when systems will be able to connect to you via your name or identity.

Traditional telecoms should be looking to strengthen their managed and hosted service offerings. Just because the ability to DIY exists does not necessarily mean that every enterprise has the time, expertise or inclination to do so. As corporate components like contact centers, PBXs and employee devices make the switch to WebRTC, many enterprises will still be looking for a vendor to do all of the heavy lifting.

Making existing telecom networks open and accessible to WebRTC may also prove to be a key strategic move. Allowing developers to create applications that can access customers on your network preemptively addresses feelings that businesses might have regarding the need to go somewhere else to secure WebRTC benefits. Providers who are able to use their existing gateways to bridge WebRTC, PSTN and wireless networks will definitely capture people’s interest.

There is also the possibility of establishing partnerships with OTT players. This has the advantage of leveraging the brand recognition of the OTT while allowing the operator to remain as the primary customer interface. Special pricing or discounts for use of the OTT partner’s service could be a significant draw for end users.

Charging is going to be a key component in making WebRTC-based services a moneymaker for traditional telecoms. They will have to make sure they can identify WebRTC traffic on their networks and create charging models and service plans that monetize it. Switching over to metered-based consumption pricing plans from traditional rated telecom plans will be essential. Think about new plans and models that play into WebRTC’s strengths.

Platform as a Service (PaaS) capability for Emergency Services integration is also an area where telecom providers may be able to profit. As WebRTC becomes a replacement for traditional telecom it will start to take on some of the requirements as well such as being able to provide E9-1-1 capabilities.

Wireless providers could see a number of opportunities to benefit from WebRTC and VoLTE. Unified Communications tools, once the sole property of wireline and IP-based services, are gaining traction in the mobile world. Now is the time for those providers to offer users great tools that will secure their loyalty and boost utilization of their services from an enterprise perspective.

Wireless providers are likely to see acceleration in current trends where voice utilization rates are in decline and data utilization rates soaring. Consumers will want mobile devices to participate fully in the WebRTC world. They will expect that clicking the ‘Talk to a CSR now’ button on a website works just as well on their mobile phone, if not better, than it does on their desktop. Devices and mobile networks without WebRTC interoperability will be at a disadvantage.

In addition, as enterprises are freed from needing traditional telecom network services to satisfy their needs, wireless providers may find new opportunity to capture more of the B2B market. Providers who are already able to demonstrate the ability to deliver quality of service for calls made over VoLTE will be in a strong position to convince customers they can deliver similar quality for WebRTC connections.

After decades of worrying about individual customer churn, carriers need to shift their focus to providing solutions for enterprise customers. While the process of doing that may be a challenge, the upside is a more promising growth model with value-added services.

Providing tools that will allow developers to merge subscriber’s devices, browsers and mobile applications into a single experience will be crucial. Providers who can leverage their IMS solutions and integrate WebRTC into it will be at a significant advantage.

New pricing models could also emerge in this space to accommodate data that is consumed by WebRTC-based services. Perhaps traditional data is available at one price and WebRTC data at a different price. The ability to identify and rate for specific kinds of data usage will be challenging for providers lacking consumption-based billing capabilities. Providers will need to understand how businesses will use mobility to improve productivity and build pricing plans that capitalize on WebRTC’s capabilities in a mobile environment.

Already operating in the IP world, these providers understand the inherent value of Web-based communications, as do their customers. If WebRTC makes it easy enough for nearly any business to create its own video conferencing application, where might that leave UC and IP players? The answer needs to be with the opportunity to trade in their old technology and push the bounds of WebRTC even further than they could take their old proprietary technology solutions. Staying ahead of the R&D curve with more capabilities will drive adoption and profits.

WebRTC will likely do for web conferencing what HTML did for content. Suddenly the playing field is much more level and the barriers for someone to launch and sell a web conferencing solution are going to be extremely low. Customers of proprietary solutions like Webex and even enterprise UC services may be left wondering what they’re paying for.

UC and IP providers need to do more for their customers and do it better. WebRTC correctly chose to not include any signaling protocol. All of the standard components of a communication session such as initiation, termination, authentication and usage metering are left up to the developer. By building WebRTC into existing SIP and UC capabilities providers have an opportunity to provide an experience that differentiates and far exceeds other solutions that might be available.

To monetize: Innovate, expand and leverage the WebRTC protocol for your own good. Use it to simplify and enhance the service you are already providing. Subscription-based models and MRCs will probably not be sophisticated enough or robust enough to satisfy customer invoicing requirements. Businesses still want to be able to have insight to their communications consumption at a detailed level.

After launching businesses on the backs of traditional network operators, some OTT players will likely find themselves scrambling for relevance in a WebRTC world. Skype, ooVoo, Viber and others who have proprietary protocols and applications required to use their service will find that the walls that have kept users on their systems have suddenly come crashing down.

Client downloads, user accounts, dedicated audience and preferred relationships with other media providers suddenly may go away. As armies of innovative developers start building competing solutions, the services that OTT providers have been providing will become commodities and the value that users see in them less clear.

Although WebRTC will change many things, ultimately it is a web standard and not a communications client. WebRTC is not going to provide the niceties that users expect from their clients such as user profiles, presence awareness, alerts, history, multi-device synchronization, or user identity authentication. Embracing the open communications nature of WebRTC while still securing customer loyalty to their application/services will be a key area for investment for OTT players.

Connectivity to the PSTN, advertising, and value-added services are the likely revenue streams for OTT in a WebRTC world.

Things change fast in the world of technology. While there are still many critical elements to agree on before WebRTC is as commonplace as the devices it can empower, the protocol has definitely moved to the next level as a technology that warrants our attention. The critical momentum is there to begin making plans to integrate WebRTC into the business.

Given that some verticals in the communications industry may find WebRTC disruptive while others find it merely the next phase of natural development for their products and services, the financial payoff remains likely, but hardly guaranteed. As with anything technology related, it is not the technology itself that is so remarkable, it’s the creative ways that people apply it and build on it that makes it both sustainable and profitable.

Related Articles

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More