Telecom Companies may block WhatsApp, Skype calls to generate more revenue

Telecommunications companies in the country may result in blocking calls made on Instant Messaging applications, WhatsApp and Skype in other to boost their revenue.

According to The Punch, the telecoms companies seek to address their loss on international calls and are targeting a revenue of N20trn.

This development may also prevent subscribers from performing certain functions like voice and video calls on WhatsApp and Facebook, among other Over-the-Top services.

“It is an aggressive approach to stop further revenue loss to OTT players on international calls, having already lost about N100tn between 2012 and 2017,” a manager at one of the major telecoms companies in the country said.

Speaking on the condition of anonymity, the manager added, “If we fail to be pro-active by taking cogent steps now, then there are indications that we may lose between N20tn and N30tn, or so, by the end of 2018.”

The source said the increasing rise of the OTT players, who provide voice and Short Message Services, or apps such as WhatsApp, Skype, Facebook, BlackBerry Messenger and Viber, was taking a huge chunk of the voice revenue of telecommunications companies in the country.

A United Kingdom-based research and analytics company, Ovum, stated in a report recently that $386bn loss would accrue over a period of six years – between 2012 and 2018 – from Nigerian customers using the OTT voice applications.

“Generally, the main fear of the telecoms operators here will be that customers will increasingly use Skype as a substitute for conventional international calls,” the Principal Analyst at Informa Telecoms and Media, Matthew Reed, said.

The telecoms operators in the country are saddened because international calls make up a critical part of their revenue because of Nigeria’s large expatriate and Diaspora population.

The operators blame the Nigerian Communications Commission for not properly regulating the sector in order to protect and keep them in business.

The Director, Public Affairs, NCC, Mr. Tony Ojobo, who reacted to the development, said, “We don’t have any evidence of that. We do not regulate the Internet.”

The Managing Director, TechTrends Nigeria, Mr. Kenneth Omeruo, said, “I am not aware of this development but globally, operators and network equipment makers don’t really embrace Skype.

“They liken Skype to an individual who takes undue advantage of other people’s generosity without giving anything in return. Globally, there is this apprehension among telecoms operators that Skype only steals their customers, while they invest billions of dollars to build, expand and upgrade networks.”

The Public Relations and Protocol Manager, MTN Nigeria, Mr. Funso Aina, who spoke on the matter, said it was sad that the OTTs provide a lot of facilities for users free of charge, using infrastructure of the network operators, but without commensurate compensation to operators.

According to the firm, a ready example is WhatsApp, which provides free instant messaging services as an alternative to text messaging services provided by mobile network operators.

“It (WhatsApp) has also launched a free voice service.

“The point to note in this argument is that the OTTs allow users to send unlimited texts, images, video and audio messages free of charge, using their current data plans.”

Aina added, “At the same time, they are denying operators of revenue to grow their networks, thereby impacting on service delivery and long-term sustainability.

“For instance, to date, MTN has invested over $15bn in building its network in Nigeria. You can now imagine an OTT leveraging the network to deliver its content without investing a kobo locally. The impact on revenue is huge.

“Furthermore, because these entities are not licensed, and because they have not built any infrastructure locally, they do not have the same costs as the licensed operators.

“They do not pay taxes, they do not employ any people locally, and indeed, they have no local presence whatsoever, meaning they do not make any contribution to our economy and their services are denying those who make contributions of income.”

On the argument that operators are recouping their loss of voice and messaging revenues through increased data prices, Aina said that was not the case.

He explained, “Every service is provided at a cost, and we cannot subsidise one service through revenue from another; so, the argument as to whether loss of revenue from one is being offset by another is really not a fruitful argument.

“The important thing is that services must be produced efficiently and all stakeholders, including our customers, must get fair value for their investments.”