WhatApp calling feature could hit revenue of mobile operators

The launch of voice calling feature on popular over-the-top  (OTT) messaging service app WhatApp could hit the Indian mobile operators hard, denting their revenue from domestic long-distance operations, which make roughly a fifth of their topline.

So far, the impact of free calling through OTT techniques like Viber or Skype had mainly been limited to international long-distance, which had led to a decline in their outgoing calls.

Since mobile operators do not earn much from the highly-priced international long-distance (ILD) services with less than 10 per cent of their mobile revenue coming from ILD operation as against 18-20 per cent of the revenue coming from domestic long distance or STD, they had largely escaped an impact.

However, now with domestic long-distance calls introduced by free calling apps launched by WhatsApp instant messengers operators could end up seeing their lunch eaten up by these services.

Though free calling apps like Skype or Viber were always available for making domestic long distance calls, their usage, so far in this segment, had been limited.

WhatApp, with a dominant share of the OTT market and 52-per cent of mobile users using it, posed the threat of taking away a significant chunk of STD callers to its app.

Once the shift becomes more pronounced, the operators, who had previously taken a hit as free messaging services ate into their SMS business, would lose a part of their National Long Distance (NLD) revenue too, which could deal a serious blow to their revenue.