Ovum Survey Shocker: OTT Video Calling Is More Popular Than OTT Voice

James Crawshaw
Heavy Lifting Analyst Notes
James Crawshaw, Senior Analyst Service Provider IT and Automation, Heavy Reading
7/5/2018



I was surprised by this Ovum survey that indicates that 47% of US mobile subscribers use OTT video calling at least once a month and 32% use OTT voice. The results are similar in the UK (where I live) and even higher in developing countries.

I have heard that sending voice recordings via WhatsApp is popular though I have never done it nor tried video calling. I have tried voice calls over WhatsApp but not often. My digital advisor (ten-year-old son) just uses WhatsApp for text messaging (no voice or video calls so far).

WhatsApp announced in June 2016 that "more than 100 million voice calls are made every day on WhatsApp." They had 1 billion monthly users at the time and that increased to 1.5 billion by the fourth quarter of 2017. Of these, around 1.2 billion were daily users. Daily messages were around 60 billion, photos 5.2 billion, and videos 1.2 billion.

Let's assume there are now 200 million WhatsApp voice calls per day (100 million x 1.5 for user growth since Q4 2017 x 1.33 for increased individual usage). This equates to 6 billion calls per month (200 million x 30).

Let's assume, conservatively, that the Ovum stat for US is the global average i.e., 32% of WhatsApp's 2.3 billion (1.5 billion x 1.5) users make these 6 billion calls per month. That equates to eight calls per month ([6 billion/2.3 billion]/32%) per individual. That is not a large number and the US stat is probably below the global average making eight calls per month an overestimate. So, the popularity of OTT voice calling indicated by the Ovum survey appears to tally with the data disclosed by WhatsApp (the world's most popular messaging app, ahead of FB messenger, WeChat and QQ Mobile).

What is still surprising about the Ovum survey is that OTT video calling is more popular than OTT voice calling. In its Q1 2018, FB reported 3 billion minutes of voice and video calls every day. If we assume 300 million voice calls (200 million WhatsApp and 100 million Messenger) and another 300 million video calls (assuming same as voice) we get 600 million in total, each lasting five minutes on average. That seems a realistic number, albeit probably skewed by some longer calls.

Back in February 2014, Apple revealed its users made 15 to 20 million FaceTime calls every day. Cultofmac has cited financial analyst estimates that the iPhone user base is about 80% bigger now (c. 900 million) than in 2014. Hence, FaceTime usage in 2014 was 17.5 million/500 million messages/user per day (0.035). If we assume only half of Apple users use FaceTime, this still corresponds to 0.07 messages per day or 2.1 per month.

We can reconcile this analysis with the Ovum survey data if we assume more people use video calling than voice but the number of video messages they send each month (around two) is much less than voice messages (around eight).

Who cares? And what are the implications of all this?

Well it looks like traditional cellular voice calls could become a relic like landlines. However, a big inhibitor to OTT video and voice messaging is that it eats into your data allowance if you are not on WiFi. Results vary, but if we assume 1MB per minute for voice and 3MB for video then a 3GB monthly limit would cover 50 minutes of voice or 17 minutes of video each month. I suspect people tend to exhaust their data limits a lot more often than their voice minute limits and hence there is still a reluctance to use OTT voice and video messaging on mobile. However, convenience is a critical factor here. If you are responding to a WhatsApp message, it is far easier to click the call button on the app than to go back to the home screen and then launch the phone app and search for the same contact.

As more and more of our communication is routed through Facebook's WhatsApp and Messenger, they will be able to amass even more information about their users for targeted advertising. Facebook has denied that it listens in to voice calls and claims it just logs their length and who you are calling to create a "better experience."

Meanwhile mobile operators may find that all their investments in VoLTE and RCS are for naught as OTT providers win and they are left monetizing the data pipe. The other losers here are Apple and Google who control the operating system but seem also to have been disintermediated in messaging.

Software is eating the world once again.

James Crawshaw, Senior Analyst, Heavy Reading

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