Mobile video not 'new voice' despite subscriptions increasing to 390 million in 2016

LONDON, UK: Video telephony, sharing, and messaging services over mobile networks were used by fewer than 47 million consumers at the end of 2011, but will grow substantially over the coming years to reach 390 million users in 2016.

Mobile operators once regarded video communication as the “new voice” and a source of serious potential revenue, but their expectations are now more realistic. Free alternatives will always be available, which limits the industry’s pricing power. “Only a small minority of consumers are willing to pay a premium price for video calls,” says senior analyst Aapo Markkanen. “Video services will be monetized by their bundling with other communication media, promoting premium features to enterprises, and delivering advertisements.”

But could operators seek edge by simply delivering a better system than the over-the-top players? Markkanen is skeptical, pointing to the evidence from voice and messaging services. “Traditional mobile services didn’t evolve in a practical sense with the operators in the driver seat. I seriously doubt they can reinvent video services.”

Perhaps the most serious dilemma for the industry is the lack of interoperability of separate video ecosystems. Or as practice director Dan Shey puts it, “What’s the point of being able to make video calls if none of your close contacts can receive your calls? Allowing the different ecosystems such as Tango, fring, and Apple’s FaceTime, as well as all the carrier services, to seamlessly interconnect with each other is a big challenge. If it can be addressed effectively, large-scale adoption of mobile video could be closer than expected.”