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VoIP's Not the Devil, Says O2 UK Chief

Ray Le Maistre
10/24/2011
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VoIP is an application that should be embraced by mobile operators and not treated as a threat, according to Ronan Dunne, CEO of Telefónica Europe plc (O2) 's U.K. operation.

O2 UK has just started a trial of its O2 Connect service that allows its Android and iOS smartphone customers to make voice calls and send texts over Wi-Fi connections using an application based on Jajah IP app capabilities acquired by Telefónica SA (NYSE: TEF) in 2009. (See O2 Trials VoIP Service, Euronews: Telefonica Goes After Skype and Telefónica Buys VoIP Player Jajah.)

So what's the plan behind this move?

"We set ourselves the challenge of being the unique communications partner for our customers, so when we saw VoIP arriving we had two choices -- close our eyes like others do and see VoIP as the devil incarnate, or embrace it and include it in our full services model," Dunne tells Light Reading.

"The trial is to see how that works with customers, how they use it. We took the view that we should be at the center of innovation in voice. Now, just because we bought Jajah that doesn't mean we think we need to own everything, but voice is very core to our proposition," he adds.

IP voice over Wi-Fi looks like a service that would help kill off O2 UK's valuable traditional voice revenues, so what's the operator's view on the cannibalization of its core revenue-generating service?

"The challenge is that if we don't offer [VoIP], our customers will go elsewhere and we could lose the primary relationship with our customers. ... We are not increasing the risk of cannibalization, we are internalizing it," says Dunne.

The O2 Connect service has been developed by what is now Telefónica Digital, the new unit formed recently to develop services, business models and relationships for the global operator. (See Telefonica Holds Key to Digital Model, Telefonica Restructures, Creates New Units and Telefónica's Looking Trendy.)

"By having Digital, which is a shared resource, it increases the chance of having this sort of innovation," says Dunne. "In telcos there's the chance that the 'old telco' mentality would override everything," he adds, but he believes that the new unit, which has been blessed with relative autonomy, will "be able to create new business models for O2 and not be constrained by a legacy mentality."

— Ray Le Maistre, International Managing Editor, Light Reading

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tnerber
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tnerber,
User Rank: Light Beer
12/5/2012 | 4:50:42 PM
re: VoIP's Not the Devil, Says O2 UK Chief


Great to see Mr. Dunne and O2 embrace the "new mentality".

idtchris
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idtchris,
User Rank: Light Beer
12/5/2012 | 4:50:40 PM
re: VoIP's Not the Devil, Says O2 UK Chief


Great news, it's time to break the mold. We are at a huge crossroads in the voice/convergence market. Telco's would love to push us slowly and inexorably back towards traditional business models. Models which seek to force converged technologies back into the old way of ISDN/ATM billing and centralised control instead of embracing the innovative explosion created with the advent of the public Internet. Such innovation now finds a mature playing field in which to grow and become profitable, but only if traditional Telco's have the vision to adapt and change. Go on Telefonica, lead the way and show us how it's done!

paolo.franzoi
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paolo.franzoi,
User Rank: Light Sabre
12/5/2012 | 4:50:40 PM
re: VoIP's Not the Devil, Says O2 UK Chief


You guys do know that T-Mobile has supported UMA for years right?


 


seven


 

VoiceOnTelecom
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VoiceOnTelecom,
User Rank: Light Beer
12/5/2012 | 4:50:39 PM
re: VoIP's Not the Devil, Says O2 UK Chief


Both this post and a similar one on Fierce Wireless are filled with Biblical metaphors, which is appropriate, perhaps, for the magnitude of the shift going in the business.


It is hard to fault anyone involved in Telefonica's new OTT efforts for talking them up and trying not to get held down by that "old telco" mentality.


But let's hope Telefonica has equally smart people working to make "old telco" services as relevant as possible for as long as possible.


http://thevoiceontelecom.blogs...

paolo.franzoi
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paolo.franzoi,
User Rank: Light Sabre
12/5/2012 | 4:50:39 PM
re: VoIP's Not the Devil, Says O2 UK Chief


 


So let me set a little bit of timing.  I bought my UMA phone on T-mobile 5 years ago.  So, I do mean years.  My experience with UMA was excellent, with one exception.  I bought the phone because the wireless coverage in my old office was awful.  I could use it but my employer made the normal WiFi network non-broadcasting. The guest network made me get a "pass" every day.  It was such a pain, that I never used my VoIP in the office.  It was awesome in NE CA (up by Mt. Shasta and Mt. Lassen).  All the places we stayed had WiFi but cell coverage was non-existant.  Was great for me.  The switching of calls on and off mobile to WiFi worked very well.  I do recall a call drop, but I would not assume that it is completely clean.


 


seven


 

Michelle Donegan
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Michelle Donegan,
User Rank: Light Beer
12/5/2012 | 4:50:39 PM
re: VoIP's Not the Devil, Says O2 UK Chief


Thanks. It's difficult to gauge from this side of the pond. Orange here in the UK talked up its Signal Boost (UMA) service to the trade press a few months ago, but I haven't seen much of a marketing push for it -- unless you know what to look for. Sounds similar to T-Mob in the US.

paolo.franzoi
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paolo.franzoi,
User Rank: Light Sabre
12/5/2012 | 4:50:39 PM
re: VoIP's Not the Devil, Says O2 UK Chief


I don't.  I went to T-Mobile years ago to get UMA.  I know it is promoted but ONLY if you look for it.


seven


 


PS - http://www.t-mobile.com/shop/p...


If you look at the bottom of the checklist, look at WiFi calling - that is the feature that is UMA now.

Michelle Donegan
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Michelle Donegan,
User Rank: Light Beer
12/5/2012 | 4:50:39 PM
re: VoIP's Not the Devil, Says O2 UK Chief


Do you know the take up of T-Mobile's UMA service? How much do they promote it?

wirelessjohn
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wirelessjohn,
User Rank: Light Beer
12/5/2012 | 4:50:38 PM
re: VoIP's Not the Devil, Says O2 UK Chief


O2 used to be a very customer focused company and in fact its success was built on this. The simple fact is that customers use mobiles because they are simple to use and everything is in one place. Why then would O2 choose to ignore its prime proposition by bringing into play an unintegrated client that is going to savage the customer experience.


Perhaps a more intelligent approach would have been to deploy solutions like T-Mobile USA underpinned by a proposition such as Free WiFi Calling so that customers get integration and something that seems competitive against other VoIP propositions. The operator gets offload from congested spectrum so that helps too.


I would question also the statement that this is something new as others have pointed out - UMA is essentially VoIP and has been around for atleast 5 years and offers high levels of integration and quality.


Finally, I would imagine that uptake is good given the longevity of the solution and the silence. The most noise normally comes from technologies that are struggling in the marketplace.

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