The future of VoLTE isn't voice

John C. Tanner
25 Sep 2014

Slowly but surely, LTE is finding its voice - literally. In the early days of LTE, cellcos had to rely on circuit-switched (CS) fallback to provide voice services for their LTE customers while they waited for Voice over LTE to become a viable commercial alternative.

And so it is - albeit on a relatively small scale. According to figures from the Global mobile Suppliers Association (GSA) at the end of July, VoLTE has been launched commercially by eight APAC cellcos in just four markets - Hong Kong, Japan, Singapore and South Korea - as well as two other operators in the US. Meanwhile, at least 55 more operators across the globe are gearing up for VoLTE. By some estimates, another dozen cellcos will have live VoLTE by the end of this year. In any case, device support won’t be a problem, according to GSA, which says over 90 smartphones currently on the market support VoLTE.

So it’s all blue skies and green lights for VoLTE, except for one small matter - there’s no money in it.

At least not in the way cellcos are used to thinking of voice: as a money-spinner. There’s no shortage of irony here, as cellcos are already seeing their voice and SMS revenues chiseled away by OTT players. (Ovum estimates that OTT services have cost network operators nearly $480 billion globally in lost revenue.) VoLTE is not widely expected to change that, which is why proponents are focused on VoLTE’s other benefits. Operators who have already deployed VoLTE can provide a number of good reasons for doing so, and they typically center on VoLTE’s value as a cost-effective innovation platform that will ultimately make their service packages more attractive than OTT alternatives.

In other words, the future of VoLTE isn’t really voice - not as we know it. It’s innovation enabled by VoLTE platforms powered by IMS - and cellcos must meet the challenge to make it all pay off.

Beyond traditional voice

Few dispute the idea that VoLTE won’t help cellcos generate any more revenue than they’re already making from standard voice services - not even vendors offering VoLTE solutions. But that doesn’t mean there’s no financial incentive to deploy VoLTE, says Nils Kleemann, head of mobile broadband, Asia Pacific at Nokia Networks.

“We don’t expect operators to be able to charge more for VoLTE calls as a service. The market wouldn’t support such a move,” Kleemann says. “However, VoLTE can bring benefits in opex savings due to higher voice capacity.”

Kati Ohman, product marketing manager at Ericsson, adds that the cost savings from VoLTE stem from the overall long-term cost reductions of consolidating voice and mobile broadband services over an all-IP network. “With a core network that can handle VoLTE (i.e. IMS), operators can run all their communication services on the same platform,” she says, “be it VoLTE, video conferencing, enterprise communication, voice over Wi-Fi etc.”

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