Pricing: Operators could offer integrated plans, i.e. a single bundled price for all the three core services (SMS, voice, data), to combat the OTT effect. CSPs could also increase SMS bundle allowance and reduce the price of SMSs to boost usage. Again, this approach doesn't guarantee success, as widespread popularity of apps like WhatsApp, Viber and Snapchat are seriously encroaching on the long-term prospects of SMS.

Rich Communication Suite Enhanced (RCSe): This approach lets telcos compete head-on with OTT players by launching a new, competitive service which allows the users to chat, share files and images and video call. The GSM Association (GSMA) initiated the idea of developing an application called JOYN -- a consumer brand for services based on the CSP-backed RCSe specifications. This initiative helps CSPs tackle the increasing consumer demand for enriched messaging and voice services, using RCSe underlying technology of an IP multimedia sub system (IMS). RCSe faces its share of challenges; the concept has so far failed to obtain widespread support from operators, due to its complexity and slow time to market, since its introduction eight years ago. In comparison, WhatsApp, Skype, Viber, FB, etc., were introduced to the market within a span of three to six months.

Partnership: Partnering with OTT players means CSPs can use their quick time-to-market strategy, and gain experience in Internet-based business models (e.g., ad-based and freemium). CSPs have the reach, subscribers and network capability, but with increasing penetration of smartphones, subscribers are getting accustomed to third-party services. CSPs need to drop the walled garden approach and stop operating in the closed environment of the past. Telco-OTT partnership can take the following forms:

CSPs have to devise a strategy either to monetize third-party OTT services or develop and deliver their own OTT-telco service offering. The latter is the ideal option for operators, as there is already an existing market for their self-developed OTT services. The caveat is that CSPs need a services platform that can be widely deployed and is interoperable with other mobile networks; in this regard, the GSMA's initiative of RCSe with IPEX ecosystem could deliver the desired solution.

IPX eco system with common interconnection model and roaming bilateral agreement will underpin end-to-end mapping of "IP classes of service." Mobile operators can provide consistent customer experience even on partner systems to support the rising use of service level agreements and the introduction of tariffs tiered by quality-of-service levels on a global scale.

However, RCSe is still an immature technology; while a number of operators have adopted the technology, penetration is still slow. The industry needs to develop the RCSe ecosystem further to provide a diverse range of service offerings and products to the customers.

Once successful and adopted fully the approach would allow operators to offer new services with attractive pricing plans to compete with third-party OTT services on both WiFi and mobile networks. This could halt the dilution of operator brands that third-party OTT services have caused -- WATCH OUT.

— Ravi Palepu, Head of Telco Solutions, Virtusa