According to GSMA in 2015 422 LTE networks had been launched worldwide and only 25 VoLTE networks. Today that figure has risen to 643 LTE networks and 127 VoLTE networks.
The reason for the slow rollout of VoLTE stems back to the creation of a perfect storm in early 2014. Back in the day a much-hyped VoLTE technology was sold as simply the voice step in the LTE rollout.
The first mistake was describing VoLTE rollout as a simple step, it's not. There are no deep-rooted technical complications rather it's down to logistics. Delivering a new technology into an existing eco-system is going to be challenging. VoLTE calls have to interconnect with disparate network types – 2G, 3G, VoIP, PSTN. VoLTE support on handsets was at first sporadic, the specs were poor and as with any new technology there was a revolving door of patches and upgrades to be managed.
At the same time there was a collapse in voice revenue due to the OTT players. Who wanted to be the CTO who had to convince his board to take on a complex and expensive technology rollout that delivers the same service you are already delivering on 3G equipment for a revenue stream that is reliably predicted to continue falling off a cliff?
So most networks took the decision to prioritise the rollout of 4G LTE and for voice to continue to be delivered over their existing 3G networks.
We are now seeing a confluence of network evolution and network savings driving VoLTE rollouts. 3G-network equipment is aging with end-of-life notices from vendors coming thick and fast. The savings in radio bandwidth utilisation for voice calls delivered over 4G instead of 3G was always promised but now in a more mature market is proven and quantifiable. With 5G networks on the horizon the specifications proposed, certainly for the first phases, for carrying voice are VoLTE + VoNR. It was interesting to hear at a recent industry conference, the Head of Planning Core Network at Telefonica explain how VoLTE was no longer a hotly discussed topic for inclusion on their network roadmap but a firm fixture. It’s no longer a question of if but when VoLTE will be deployed.
VoLTE was always touted as a platform for delivering new subscriber services. In the maelstrom described earlier this was largely unattainable but those operators who did bite the bullet and deployed a VoLTE network there have been some noticeable successes.
We have seen some interesting examples in the industry with multi device providing seamless connections across all your devices – mobile, laptop, tablet, TV, Echo (these last two think SK Telecom). T-Mobile rolling out their “Digits” service in the US which is essentially providing multiple virtual numbers allowing their subscribers to create multiple profiles i.e. a business profile, Running Club profile, dating profile, gamers profile, etc.
And most recently China Mobile trialling Video Ring Back Tone – whereby a short video is played on the caller’s mobile phone before the call is answered. Promoted as offering companies yet another way to advertise their fares to subscribers and hip teenagers leaving personalised calling cards. Not sure this is quite what 3GPP had in mind when they designed the standards but anyway it allows operators to differentiate and increase stickiness.
But there are still challenges. If you thought VoLTE rollout was slow then the GMSA figures of 16 commercial launches for VoLTE Roaming may leave you shocked. Full VoLTE roaming, no CS fallback allowed, is without doubt technically very complex. It also suffers similar challenges outlined earlier for VoLTE including the need to support multiple disparate network types. But conversely with the rise of VoLTE, operators are now seeing revenue opportunities for inbound roaming and this will drive deployment.
Lawful Intercept and Emergency Calls are still, in the main, handled by fall back to the 3G network. This will have to change and while we are starting to see solutions appear on the market the underlying economic impetus of VoLTE will help accelerate development.
I have mentioned the operator’s nemesis, the OTT players, a number of times. The big revenue shock to voice has already happened. Although that revenue is not coming back we are starting to see voice volumes level out and in the UK even slightly increase (see figure 4.19 in Ofcom's Report). Messaging however is a different story with operator revenue continuing to drop, mirrored here in the UK (see figure 4.21 in Ofcom's Report). The GSMA reports that RCS is gaining a foothold with commercial launches in 55 networks. Whether RCS is going to allow operators to claw messaging revenue back from the OTT’s is very hard to call. Messaging is a very nuanced market and with the exponential increase in the use of images and video providing fertile ground for California’s nimble OTT players. Unlike messaging it is hard to see how much more fundamental innovation can be done to voice calls. Even if you are super diligent and ensure that as many calls as possible go via OTT apps, any calls you need to make that simply cannot be made through them will be made via the operator's network.
For some years the narrative for operators has been about how to recapture their lost voice and message revenues with VoLTE and RCS hailed as the technologies to do so. As with many markets that have been disrupted by new technology the key is to insure the incumbent players are streamlined and efficient while they evolve to offer new and complimentary services. VoLTE rollout provides us a good example of this as it is being used to consolidate networks to all IP, providing major cost savings and will enable operators to seamlessly migrate their voice offerings when 5G makes its appearance. VoLTE as a platform is here and although there is no “killer-app” it is clearly allowing operators to innovate, offering services that will definitely increase subscriber stickiness while offering the potential to generate new revenue.