Delicate Balance: Voice Services Without The Investment

Service providers have a high-wire act to pull off: they must balance the need to have voice services in their portfolios along with the mandate to reduce spending on that very network.

Telcos and cable service providers continue to see triple play service bundles as a way to keep customers from churning and increasing ARPU. According to a new Digital TV Research report, triple-play subscription revenues will reach $144 billion worldwide in 2018, up $80 billion from 2012. Triple play revenues will dominate: that subscription option will make up 70% of total subscription revenues by 2018, up from 52% in 2012 and 36% in 2008. Overall service bundles will drive up total subscription revenues 65% from $124 billion in 2012 to $205 billion in 2018.

This highlights that voice is still a key part of the provider portfolio. Fixed voice is still essential and a huge market: it totals nearly $80 billion in North America this year. Undoubtedly voice revenue is falling. In the residential market voice is trending to being a feature versus a standalone revenue-producing subscription service. As such, it needs to delivered in the lowest cost, least risky way possible.

At the same time, investment resources and strategic focus are shifting to new projects. As an example, analyst firm Broadbandtrends released a report stating that smart home services are key to new revenue opportunities. The firm notes that broadband penetration is reaching a saturation level and service providers need to offer new services that leverage their broadband infrastructure to drive new revenues and increase customer loyalty. To successfully deploy these new home security, home automation, energy management and expanded IT support services, service providers must commit resources and fund the business and technology plans.

The cloud voice platform addresses both these realities. With a zero-CAPEX, SaaS-based outsourcing model, it reduces total cost of ownership and eliminates risk for VoIP. Likewise, it unleashes the potential for service provider growth initiatives as CAPEX and operational focus can be shifted from maintaining a voice network to finding new revenue through innovation that requires focused investment. With the cloud voice platform service providers can pull off that delicate balancing act of needing voice in the portfolio but needing that time and money freed up to focus on what’s next.

Read more in the white paper Service Provider VoIP – Next Gen is the Cloud.

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