Recently, Tara Neal, Executive Editor of The Fast Mode, had the opportunity to speak with Arnd Baranowski, Chief Executive Officer at Oculeus on the market opportunity for broadband providers to provide a modern, alternative voice/telephony service to underserved market segments.
Tara: How would you describe the current state of telephony services?
Arnd: The telephony sector is undergoing enormous changes. Now that fast and reliable broadband internet is widely available in many markets, a completely new kind of ‘telco’ - the Fibre-class Internet Service Provider - is able to offer competitive services in this area.
Fibre providers are perfectly placed to support current and future telephony needs. But they must also support the “telephony of the past”. In essence, they are replacing the former “landline” installations at each home, bound by country-specific regulatory requirements, and needing to support certain important public services, such as number assignation or the ability to contact emergency services. The point here is that service delivery is still complex.
Such providers can be viewed as being the “telcos of the future”. The market may well become balanced between fibre-class ISPs and the established mobile operators, who as well as being a significant point of focus for a consumer’s “identity”, also have resilience in that they own the networks on which their customers go online.
Arnd Baranowski, CEO, Oculeus
Tara: Where are the market opportunities for offering new retail voice services?
Arnd: ISPs have been around a long time and many can boast established customer relationships going back ten to twenty plus years. However competitive threats are never far away with customers always vulnerable to cheaper or more powerful service offers, bundled deals from big brands, or quad-play offers from mobile operators and even broadcast organisations, such as Sky TV.
So, from an ISP perspective, being able to offer voice telephony services brings two things: an additional competitive edge for attracting new customers, and an effective retention tool to reduce customer churn. In either case, the service provider gains higher revenues from each customer, and as long as cost-effective operational systems are employed, this will translate to improved margins.
Tara: What types of service providers are pursuing these marketing opportunities?
Arnd: The UK is a fascinating example, where government de-centralisation and liberalisation of fibre services has resulted in a highly diverse ecosystem of ISPs focused on regional and even local level services. These organisations have sprung up to meet the needs of underserved communities, often rural areas where mobile coverage is poor, or alternatively addressing niche requirements, such as urban business parks. These service providers bring a sense of community value, local focus to their customer service, and can sometimes offer voucher subsidies via a government scheme, all of which gives them agility and appeal in the market. This shift to digital voice providers in the UK is further driven by the withdrawal of the copper-based analogue networks by 2025.
Tara: How are customers benefitting?
Arnd: A major benefit is the high audio quality of voice over IP. Consumers, perhaps acclimatised to many years of patchy call quality over their mobile phones, are surprised and delighted once again by the ability to speak with friends and family at an HD audio level, but at a much more affordable price relative to the former landline subscriptions. For many, they are now revisiting the pleasure of a physical “home phone” and for a rural, conservative and sometimes older consumer - perhaps sceptical or confused by mobile devices - this brings significant appeal.
An additional factor is that, traditionally, consumers were required to maintain a fixed-line telephony connection in order to avail of broadband services. However, the high cost of maintaining this subscription became considered poor value for money, and with broadband-only packages becoming available many consumers opted to disconnect their landline. In rural areas, mobile coverage may be lacking and hence access to the emergency services depends on such a connection.
Tara: Where does Oculeus fit into this ecosystem?
Arnd: We provide a bolt-on turnkey technology solution so that an ISP can quickly launch a full voice telephony solution in one simple move. The solution provides at its core a real-time telephony unit – the technical engine which makes the calls happen – and supports the full customer lifecycle from onboarding through to billing. Separately, we also take care of the wholesale aspect - the interworking with other telcos - and include advanced anti-fraud protections. We do this in a way which is scaleable, from one customer to one million, so that costs are fully controlled whatever the size of the ISP.
Tara: What advice do you have to share with broadband providers considering their options for expanding their service offerings to include telephony?
Arnd: Where telephony is concerned, there is still significant “money on the table” which your customers are likely willing to share with you, or may even be spending already with somebody else. By broadening your service offer to include voice telephony, you gain happier and more loyal customers – and additional revenue!
Oculeus is a leading provider of innovative software solutions for telecommunications service providers. To learn more, please visit www.oculeus.com.
