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What Whatsapp voice means for MNO’s

April 1, 2015 8 comments

Facebook inc recently introduced the ability to make voice calls directly on its Whatsapp mobile application. This is currently available on Android OS and soon to be made available on iOS.

What this means is that mobile users with the updated app can now call each other by using available data channels such as Wi-Fi or mobile data. Going by a recent tweet by a user who tried to use the service on Safaricom, the user claims that they made a 7 minute call and consumed just about 5MB’s of data. If these claims are true, then it means that by using Whatsapp, a user can call anyone in the world for less than a shilling a minute. This is lower than most mobile tariffs.

Is this a game changer?

Depends on who you ask. First lets look at what happens when you make a Whatsapp call. When a user initiates a call to another user over Whatsapp, both of them incur data charges, in the case of the twitter user I referred to above who consumed 5MBs, the recipient of the call also consumed a similar amount of data for receiving the call. If it so happens that both callers were on Safaricom, then just about 10MB’s were consumed for the 7 minutes call. The cost of 10MBs is close to what it would cost to make a GSM phone call for the same duration of time anyway. Effectively, to now receive a Whatsapp call, it is going to cost the recipient of the call. This is unlike on GSM where receiving calls is free.  When the phone rings with an incoming Whatsapp call, the first thought that crosses a call recipients mind is if he/she has enough data ‘bundles’ on their phone to pick the call. The danger is if there is none or the data bundle runs out mid-call, the recipient will be billed at out of bundle rate of 4 shillings an MB. Assuming our reference user above called someone whose data had run out, Safaricom will have made 5 Shillings from the 5MBs and 28 shillings from the recipient. A total of 33 shillings for a 7 minute call translating to 4.7 shillings a minute which is more than the GSM tariffs.

This effectively changes the cost model of making calls. the cost is now borne by both parties, something that might not go down well with most users. I have not made a Whatsapp call as my phone is a feature phone but I believe if a “disable calls” option does not exist, Whatsapp will soon introduce it due to pressure from users who do not wish to be called via Whatsapp due to the potential costs of receiving a call. That will kill all the buzz.

Will operators block Whatsapp calls?

It is technically possible to block Whatsapp texts and file transfers using layer 7+ deep packet inspection systems such as those from Allot’s NetEnforcer and Blue coat’s Packeteer. I believe an update to detect Whatsapp voice is in the offing soon and this will give operators the ability to block Whatsapp voice. The question however is what will drive them to block it?  MNO’s will have no problem allowing Whatsapp traffic as it wsill mot likely be a boon for them if most of the calls are on-net (They get to bill both parties in the call). If however most calls are off-net (Like those to recipients on other mobile networks locally or international), then MNO’s might block or give lower QoS priority to make the calls of a poor quality to sustain a conversation. They might however run into problems with the regulator should subscribers raise concerns that they think the operators are unfairly discriminating Whatsapp voice traffic. Net neutrality rules (not sure they are enforceable in Kenya yet) require that all data bits on the internet be treated equally, it should not matter if that bit is carrying Whatsapp voice, bible quotes or adult content. This will mean that operators can be punished for throttling Whatsapp voice traffic in favour of their own voice traffic. This therefore presents a catch 22 situation for them. What they need to do is come up with innovative ways to benefit from this development like offering slightly cheaper data tariffs for on-net Whatsapp voice to spur increased Whatsapp usage within the network (and therefore bill both participants).

Worth noting is that it costs the operator more to transfer a bit on 3G than it does on 4G. Operators who roll out 4G stand to benefit from Whatsapp voice as they can offer data at a lower cost to them and this benefit can be passed down to subscribers. The fact that voLTE is all the rage now, Whatsapp voice can supplement voLTE and can even be a cheaper way for operators to offer their voice services on their LTE networks without further investment in voLTE specific network equipment.

In short any operator who wants to benefit from Whatsapp voice has to go LTE.

Why the push to digital TV?

November 12, 2012 5 comments

There has been a lot of attention in the local media on the push by the government to have Kenya migrate its TV signals from analog to digital.  The governments push has left many wondering what its stake in all this is.

In 2006 Kenya participated in the The Regional Radiocommunications Conference-2006 (RRC-06) which was hosted by the International Telecommunications Union (ITU). In this conference, it was agreed that all nations need to migrate to digital TV by 2015. Kenya set an ambitious cut-over date of 2012 as the date by which all TV broadcast in Kenya will have been migrated to digital. The Communications Commission of Kenya (CCK) has formed a digital migration secretariat to co-ordinate this migration. This secretariat is the one stop center for all matters related to this migration.

Many a bystander will ask, other than the government ratifying the RCC-06 agreement, what is the government’s stake in asking its citizens and broadcasters to change the way in which they receive their TV signals. With majority of TV services being run by private entities, shouldn’t the decision to change from analog to digital be done by these entities in the same manner in which a mobile operator decides to roll out 3G or 4G based on a business case and not by regulatory conditionality?

CCK recently expressed fears that over 40% of TV sets in Kenya are black and white and this could signal a stumbling block because owners of black and white TV sets tend to be those who are economically disadvantaged and cannot easily afford a digital set-top box.  With the deadline to switch over fast approaching, TV stations stand to lose 40% of their viewers if these viewers do not manage to upgrade to digital TV. This is a big threat to their market base and I would have expected a flurry of activity from TV operators seeking the indulgence of the government to subsidize the set-top boxes to consumers or better offer them for free as was the case in USA when they did their migration  in 2009.  If the American TV viewer who is by all means better off than the Kenyan counterpart got help from the government, one wonders what will happen to the Kenya viewer if he is not helped by the government to acquire a set-top box. The high cost of set-top boxes and poor planning of the migration project has made the government postpone the migration deadline to 2013 from the earlier mid 2012 deadline.

However, far from that, the main reason why the government (and many other governments) stand to benefit from this migration is revenues. The government is the biggest beneficiary in the digital TV migration because it will draw revenues from:

  1. The license fees from signal distribution companies: In Digital TV, all TV stations are to give their signal to a central signal distributor who will then transmit this signal on their behalf. The signal distributor pays a license fee to the government which is an additional revenue source. There is also the revenue that was to be gained from tax on the set-top boxes, there has been a push to zero-rate the boxes so as to make then more affordable to users. Even with zero rating, the importation process is poised to benefit the economy in one way or the other.
  2. With the migration of analog TV signals away from the 800Mhz band, the band will be available for auction to telecommunication operators for use in operating 4G-LTE networks.

4G-LTE networks and your TV

The 4G-LTE network can use either the 800Mhz or the 1900Mhz band for transmission, the 1800Mhz band is not preferred because it is less efficient to use than the 800Mhz band. The fact that 1800Mhz is higher frequency means that physical barriers such as building walls might impede its transmission and make it less effective for high-speed data transmission. Transmitters and detectors of higher frequency communication (4G phones in this case) tend to cost more compared to lower frequency transmitters and detectors.

The most desirable characteristic of lower frequencies is that they can travel longer distances without losing their ability to carry information. This means that a 4G-LTE network at 800Mhz will require fewer base stations than the same network at 1800Mhz. This therefore makes building and operating a 800Mhz network cheaper than one on 1900Mhz range.

The use of the 800Mhz band in analog TV transmission therefore means that mobile operators are only left with 1800Mhz  to roll out 4G-LTE. Much of the pressure to migrate TV from analog to digital is therefore informed by the fact that the government can auction the 800Mhz band to mobile operators for millions of shillings and empower them to roll our cheaper-to-run 4G-LTE networks. The by-product of this migration to TV viewers is that they get a clearer TV signal with many value additions on the digital signal such as the ability to  get descriptions of programs on TV, auto schedule TV programs of their interest, and also pay-per-view services.

How 3G Traffic To Wi-Fi Offloading Can Help Operators

August 14, 2012 8 comments

A recent research article by Khynghan et. al, in a paper titled “Mobile Data Offloading: How Much Can WiFi Deliver?” estimates that about 65% of mobile data can be offloaded onto Wi-Fi networks. By this they mean that much of the data generated by users browsing the Internet via mobile devices can be rerouted from the mobile 3G network onto Wi-Fi networks.

With the explosive growth of data consumption by mobile devices in Kenya, network operators have several strategies aimed at meeting the unprecedented growth. These strategies include 3G and 4G network expansion to carter for this growth, adoption of new technologies such as 4G-LTE and use of new network architectures that maximize network resources. Unfortunately, with declining or flat revenues and margins from unit data consumption, nearly all these strategies are expensive and eating into the already declining margins.

Wi-Fi Offloading

Wi-Fi offloading is becoming an attractive alternative path for operators to cope with the increased traffic from Smart devices. In the US, smart devices account for only 3% of all mobile devices but contribute about 40% of all mobile data traffic. With majority of these devices having  Wi-Fi capability, offloading their traffic onto Wi-Fi network from 3G presents a very viable alternative.

Wi-Fi offers the following advantages that makes it a very likely alternative to the more expensive roll-out of 3G and 4G especially in densely populated areas:

  1. It is much cheaper to roll-out Wi-Fi hotspots around a city compared to a 3G or 4G network
  2. Wi-Fi networks are very scalable, it can take months to expand a 3G network but few days to expand a Wi-Fi network
  3. A Wi-Fi network, if well designed can offer much higher throughput speeds than existing mobile networks
  4. A smart device connected to a Wi-Fi network is more efficient on battery conservation than one connected to a mobile network.

Are users really Mobile ?

There is a general misconception that mobile devices are used by users in motion, a lot of attention has therefore been paid to ‘seamless’ station to station hand-off of a mobile voice and data connection. In a paper by University of Malaga, University of Limerick and Nokia Siemens Networks the authors show that less than 3% of calls in the world are actually handed off from one base station to another. This shows that majority of “mobile” users are stationary when making calls or browsing the web. This percentage is bound to be lower in a country like Kenya meaning that deployment of Wi-Fi networks that lack hand off capabilities possessed by 3G networks will not impact user experience and operators will not compromise quality of service.

Mobile operators can spur the usage of Wi-Fi networks by first educating users on the fact that majority of mobile devices give higher priority to a Wi-Fi network than a 3G network, i.e. if your phone is connected to both Wi-Fi and 3G, it will by default send data over the Wi-Fi network and revert to 3G when there is no Wi-Fi coverage. The operators can also send over the air (OTA) Wi-Fi configurations and settings to enable mobile devices automatically connect to the providers Wi-Fi network when it detects a good signal. The operators can also spur usage of Wi-Fi by mobile users by offering better data tariffs for users on Wi-Fi than those on 3G/4G.

Statistics from the research by  Khynghan et. al. show that 3G to Wi-Fi traffic offloading tests done in New York City showed that over 65% of 3G mobile data was offloaded onto Wi-Fi networks by smart devices leading to faster browsing speeds and a 55% battery saving as devices no longer need  signaling power. (be it legacy ss7 or SIGTRAN).

In these days of shrinking revenues and skyrocketing costs,  Kenyan mobile operators should give Wi-Fi a thought if they are to meet their customers expectation of quality service and give their shareholders return on their investments.

 

 

 

Categories: Mobile Telephony Tags: , , , ,

How the Green Mobile Revolution Can Help Rural Africa

October 10, 2011 Leave a comment

The mobile communications revolution sweeping across Africa has come with its own problems. The major one of these problems is the negative environmental impact it’s had due to the use of non environmentally friendly power sources to power this revolution. The carbon foot print of a typical caller in Africa is much wider than a similar caller in more developed regions of the world.

However, all is not gloom as this environmental impact this revolution is having can be turned around to benefit rural Africa as per my recent article published in the Developing Telecoms journal. Read the article by clicking here

Mobile Number Portability: Has it flopped?

April 11, 2011 4 comments

 

Ten days since the official start of Mobile Number Portability in Kenya, the industry is eerily silent on its progress so far. We expected an avalanche of subscribers porting their numbers to rival networks. I’m not sure it happened and if it will happen in future.
Whereas the local media is seeking information on how many people have ported across networks so far, they keep on getting tossed round from operators to CCK to the porting company and back again without concrete answers on how many people have successfully ported across. However, sources claim that less than 1,000 people have applied for porting.

The problem lies in information. People are not well informed on how to port across and what this porting business is all about. The concept of MNP is simply not well understood by consumers.

I happen to ask people I consider fairly educated on what MNP is and the answers I got from them surprised me due to their inaccuracy. They all had some basic grasp of what it entails and that was it. Some thought they would maintain their previous SIM cards when they port, some said they fear porting because they will lose their SIM contacts, some said MNP will cost them 200/- for cross network calls etc. However, the shocker was when I talked to some people from my village who had no clue whatsoever about MNP. They even declared me a liar for claiming that they can have a 0722 number on Airtel or YU or a 0733 number on Safaricom or Orange.

In addition to the above, I have noted that there is an increased search for information on MNP on the web that hits my blog. This increased search includes such terms as below which I extracted from my blog search stats:

can i shift from safaricom to airtel without changing sim card
airtel mnp number
line portability-safaricom
mnp process airtel
network architecture of mnp in india
questions of portability number
how to port my number from safaricom to airtel
questions on mobile number portability
mobile number directory
how many people port to a different network on average per year mnp
portabilty safaricom zain airtel
mobile line transfer across safaricom
How to move my number from airtel

This just goes to show that the public is not well informed about the MNP concept and they lack information to enable them take advantage of MNP. The fact that people who can surf the web and do a search are asking about MNP process means that there are millions of subscribers who have not even heard of MNP.

My thinking is it’s the poor population with no Internet and newspaper access who are price sensitive and would port their lines to the cheapest network. I therefore expected the mobile operators to target these people through local vernacular radio stations, posters and road shows and not newspaper and TV adverts as is the case now. The increase in number of searches on the web on MNP means that even people who have access to Internet, newspapers ( and therefore fairly well informed) are not well informed about MNP. It’s no surprise that my village mates have never heard of MNP. Infact if you noticed, CCK started the MNP adverts on TV and the print media two days before MNP kickoff.
Airtel seems to be the only operator keen on educating the consumer on what MNP is all about and the benefits it offers.

News coming out of India where MNP was recently introduced shows that MNP has failed to live up the hype that preceded its launch. Out of a subscriber base of over 791 Million, only 1.7 Million had applied for porting in the first 15 days. That represents a 0.2 % uptake of MNP in India. The slow uptake and problems faced by subscribers who have ported made it flop.
The few customers who have ported in Kenya are complaining of inability to call or be called by subscribers on the network they migrated from, this is indicative of sabotage by operators just as I had predicted in a previous post here.

I also believe that price is no longer the main motivator for porting, the cross network and on network charges are nearly the same on the various providers networks and the 200/- porting fee is actually worth about 200 minutes (3.3 Hours!) worth of airtime. The operators should now focus on VAS as the motivating factor to move across networks as opposed to price.

The final issue is the porting process is too complex for the average Kenyan. Operators should have come up with a simpler way of porting and shift the operational aspect of porting to the recipient network because right now the porting process is split between the end-user and recipient network. Also the porting period of 48hrs is too long for a subscriber base such as ours, The period should be reduced to the globally accepted 2 Hrs (In Australia, it takes 3 minutes to port across networks, its even shorter in New Zealand).

So once again, a noble concept has failed due to failure to sufficiently educate the consumer before hand and making business decisions on the false belief that consumers are raring to port across networks because it successfully happened elsewhere before. The Kenyan mobile consumer is a peculiar one indeed!

Categories: Mobile Telephony

Questions about Mobile Number Portability

March 15, 2011 2 comments

 

As from 1st of April, Kenya will embrace the concept of Mobile Number Portability (MNP). This is whereby mobile users will have the freedom to change operators while still maintaining their mobile telephone numbers also known as the Mobile Station International Subscriber Directory Number (MSISDN). The MSISDN is made up of the country code (CC), the National destination code (NDC) and the subscriber number (SN). Whereas the country code is one for any given country, the NDC is operator specific and is what uniquely identifies a mobile number as belonging to a given mobile network examples of NDCs are 0733, 0722 and 0755.

In Kenya, Mobile phone market share is skewed in favor of Safaricom which maintains a 75% share of the subscribers with the other three operators taking the rest. This obviously makes number portability a viable avenue in which the  operators with a smaller share can rope in subscribers from Safaricom. This is especially true because most subscribers who wish to change operators at the moment cannot do so because it would mean them changing their numbers. The emotional attachment to mobile numbers is uncharacteristically strong in Kenya to the extent that not many people changed operators even when the other operators calling rates were lower. YU introduced 50 cents rate and few moved. Orange introduced a flat rate 100/= per month rate and few moved over. This has been attributed to the emotional bond to mobile numbers.

However, some serious questions about the implementation of MNP in the market have not been answered.

The first one is that not all operators are in favor of MNP. The dominant player feels they stand to lose and will not be so keen on making sure that this new process works. in December last year Safaricom CEO was quoted as saying that MNP will not work in the country because Kenyan subscribers own more than one SIM card. This line of defense is because should MNP work as planned, Safaricom will be the biggest loser. On the other hand, Airtel fully supports MNP and has even started an aggressive campaign in the print media dubbed “Ni Kuhama”to sensitize subscribers on MNP and urging them to cross over come April 1st.
If all operators are not for the idea of MNP, a similar scenario such as the one that is currently in India will also play itself here in Kenya. Indian operators have been accused of sabotaging MNP which was introduced in November 2010. Some of the complaints include operators frustrating customers who want to port their numbers to competition. Some subscribers have complained to the Indian department of telecommunications (DoT)  with complaints ranging from  current operator issuing wrong porting codes, dead phones on porting, to service inaccessibility after requesting for porting. The number porting process is also taking an average of seven days to be effected as opposed to the standard 2 Hrs. DOT has now summoned the operators to discuss these issues.

The presence of operator specific VAS will also pose a challenge to  subscribers and the CCK needs to lay the rules on how issues cropping from this will be handled. For example, If you want to MPESA me on my number 0722-123456 because you still think I’m on Safaricom but I have just migrated to Airtel or Orange, you the sender needs to be protected from being billed for cross-network funds transfer charges because they are ten times the on network MPESA charges. CCK will need to force Safaricom to send you a warning message that I changed networks and you are about to be billed for cross network money transfer and you can either accept or decline to continue further with the transaction. This warning should be at no charge to anyone.
If this is not done, there will be a lot of confusion and apathy to the use of VAS as users will fear being overcharged. This will lead to a decline in this critical revenue stream for the operators.

The third issue is the due date for MNP is fast approaching and CCK has not done enough public education and awareness campaigns on what this is all about and the impact it will have on the consumers life. The fist impact is the consumer will no longer be in full control of his mobile phone calling expenses as he can now not estimate how much a call is going to cost him or her. This is because the certainty of if the call is an on-net or off-net call will be removed with the advent of MNP.
The other problem is many Kenyans own low end phones bought on offer from their current providers might have a problem moving across networks unless the current operator unlocks their phones to accept new SIM cards. Doing this by yourself can land you in jail as per the communication (amendment) act of 2009 which says in section 84G(1) and (2)

(1) Any person who knowingly or intentionally, not being a manufacturer of mobile telephone devices or authorized agent of such manufacturer, changes mobile telephone equipment identity, or interferes with the operation of the mobile telephone equipment identity, commits an  offense.
(2) A person guilty of an offense under this section shall on conviction be liable to a fine not exceeding one million shillings or to imprisonment for a term not exceeding five years or both.

This fact can be exploited by your existing operator to prevent you from changing networks and should you wish to do so, you will be forced to invest in a new handset. The other side of the coin to this is operators might be forced to start offering free or heavily subsidized handsets to would be customers who wish to port.

The CCK and operators therefore need to clear the air on the issues above so as to make MNP a success. This is because its been tough implementing MNP in many countries including USA, Malaysia, India, South Africa, Thailand, Brazil and many more countries with more mature telecom systems and markets  than ours.