Truphone: mobile VoIP Euro-style
Let’s face it, Europe is a different market. But with daily assertions that the-world-is-flat and one big market, I am still struck by regional interpretations of technology.
Take mobile VoIP, for example. Though it hasn’t rolled out yet, mobile VoIP for the North American market promises:
- Presence applications. VoIP-based apps display the state of the user you are trying to reach: I am on the phone, I am in a meeting, don’t bother me, I am on-line.
- Higher average revenue per user (ARPU). Operators charge more for market-specific applications. Every contractor and warehouse worker needs push-to-talk (PTT) — which has one of the highest ARPUs in the mobile industry.
- Lower infrastructure costs. Operators save money on all-IP core networks and get higher voice capacity per cell tower.
But in Europe, mobile VoIP means only one thing at the moment:
- Users by-pass long distance, arbitrage mobile minutes, save money. Mobile operators take it in the shorts.
Witness Truphone’s recent round of financing of $24.5m. Download the Truphone client to your dual-mode Wi-Fi/GSM phone and make free Wi-Fi mobile-to-mobile calls or save a bunch of money on a salad bar of other VoIP-style deals. Bottom line, Truphone is establishing itself as a by-pass service provider and there is nothing that Euro-operators can do about it. How can that be?
Unlike the US market, customers can buy any GSM phone insert their operator-supplied SIM card and they are off to the races. If the user chooses to buy a dual-mode phone with both GSM and Wi-Fi, the mobile operator has no control over the Wi-Fi portion of the phone.
Hmm…Then it must stand to reason that Nokia pushing a pile of Wi-Fi/GSM phones could rub the Euro cell operators the wrong way. So what? What’s a poor Euro-cellular operator to do? Not much. Since GSM SIM cards have nothing to do with Wi-Fi authentication and authorization, there is almost nothing the operator can do to stop Truphone-style mobile VoIP operators from springing up. I suppose they could try modifying the ancient GSM standard to somehow gain control over the Wi-Fi radio. But don’t hold your breath on that one.
Is this a permanent trend? Definitely. Truphone’s funding will further legitimize the fledgling “software-only network operator.”
On the horizon, I believe Euro-operators will respond with GSM and UMTS-based femtocell base stations for the home, and with UMA-based services over Wi-Fi. Until then, advantage Truphone.
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