Et Tu? How operators can ‘do’ OTT

Telefonica's launch of Tu Go showed that the recent rise of OTT comms has had a huge impact at a business level, but what are the technical implications for other operators looking to take this route?

By Thorsten Trapp
The rise of OTT has been spectacular – in the ten years since the launch of Skype it has gone from nowhere to being a major alternative communications channel. Indeed, according to research released by GigaOm in January, 2013 is the year when mobile IP messaging volumes will overtake SMS for the first time. This impressive growth means that operators can no longer ignore the OTT opportunity; instead of blocking it, operators should grab the opportunity that OTT has to offer.

The launch this March by Telefonica of its Tu Go service in the UK was something of a ground breaker – it was one of the most complete OTT services created by an operator to date. It offers full OTT functionality integrated into the user’s core mobile account, by letting users route calls made to their standard mobile number to non-SIM, IP-based devices via an app. This obviously has huge implications at a business level, but what are the technical implications for other operators looking to take this route?

There are several OTT scenarios that operators can consider, from an OTT-lite packet-switched version, through to the full blown IP integration of Tu Go.

At the simple level, an OTT style service could be implemented using the operator’s IMS system, connected with the GSMA’s RCSe/Joyn standard. This would enable users to call other members of the same network via an OTT-style app, but calls would be routed via the packet switched network and potentially zero rated on their bill. This iteration obviously doesn’t represent ‘real’ OTT as the calls and messages never move to IP but, to the end user, the result (free calls, presence data etc) is the same.

A more complex option, and the one adopted by Telefonica, is to go down a more fully fledged OTT route. To do this, an operator would essentially have to change not just the software and infrastructure but the processes at the core of the network’s operations. Operators are currently SIM-card focused and this is the basis of all subscriber identification and billing. Therefore, to move calls and messages to pure-IP devices requires a virtualisation of mobile numbers away from the SIM and into an IP space. Calls and messages can then be transcoded between IP and packet switched as required and routed to the required destination as specified by the user via a proprietary app. This option gives subscribers access to ‘real’ (if walled garden) OTT, but can be costly and complex.

For an operator looking to develop a more fully fledged OTT service, a third party specialising in managing telco-OTT interfaces will have the technology in place to manage the virtualisation of mobile numbers, routing and transcoding aspect of the process, simply feeding into the operator legacy network as required.

A further option is to reconsider the whole operator approach to OTT provision. As an operator, business considerations are always going to limit the power of your OTT roll out – the threat of cannibalisation means that a totally open and interoperable OTT service is always going to impact core revenues. For example Tu Go, whilst ambitious, is still limited by the fact that the pure OTT aspect of the service only works between Telefonica users. Therefore, instead of operating a limited, proprietary OTT service, another option is to help power third party services and gain a share of their revenue in return. Powering OTT-telco interoperability for third party OTT services lets an operator generate additional revenue from cross net (e.g. OTT-mobile) calling by users of OTT apps.

Both of the last two options (OTT and powering third parties) can also be facilitated through third parties. For an operator looking to develop a more fully fledged OTT service, a third party specialising in managing telco-OTT interfaces will have the technology in place to manage the virtualisation of mobile numbers, routing and transcoding aspect of the process, simply feeding into the operator legacy network as required.

Meanwhile, if you want to power third party service interoperability, operators can resell voice, messaging and mobile numbers to OTT players looking to offer IP-telco interoperability via third parties who specialise in aggregating this connectivity for the OTT market. The third party simply integrates into your core network and they can manage the resultant commercial and technical relationships with OTT players. In return, you gain a revenue share on traffic generated between the OTT player’s virtual numbers and traditional telco infrastructure.

OTT is a challenge for operators at all levels, commercially and technically. At a network level the options are varied, from the toe-in-the water approach of OTT-lite through to the full immersion of the shift to virtual numbers. However, at every stage there are alternative options that can ease the process, whether by taking the heavy lifting of virtualisation on board or by opening the door to OTT revenue without the technical work of building a proprietary system.

Author: Thorsten Trapp is CTO, tyntec.

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