Are WhatsApp, Viber and Other OTT apps a Threat to Telecoms?

Are WhatsApp, Viber and Other OTT apps a Threat to Telecoms?

We all know OTT voice over internet protocol (VoIP) services such as Skype, Viber, WhatsApp and WeChat provide an alternative to traditional voice and SMS services. The old high charges accumulated while roaming on other networks abroad can be significantly minimized.

All you need to do is obtain internet access by either using wireless internet or a SIM card from one of the networks in the visited country and you can make unlimited calls to anyone anywhere in the world.

Now OTT players are aggressively eating into telecom revenues from calls within OTT applications. This has been possible especially because an increasing number of international travelers have an OTT app installed on their handsets.

According to Revector, one of the telecom fraud detection solutions provider, in recent months, more than 25% of international calls are now terminating as OTT with Viber terminating up to 45% of international traffic on certain routes. In telecom fraud terms, OTT bypass is the latest form of SIM- Boxing.

When a mobile user sends a message using WhatsApp as opposed to an SMS or makes a Viber to Viber call (instead of an international call), the telecom operator loses out on interconnect revenue. This is not a fraud but there are cases when a user makes a genuine international call from an international source and the call is hijacked and terminated using OTT apps. In either of the cases, the telecom operator loses out on incoming interconnect revenue.

OTT bypass is a hybrid of the illegal bypass model with the legal OTT model. Consider a scenario where the call originates on the caller’s traditionally net worked device via the OTT software it runs. The person who originates the call may think they are paying for a call to an ordinary telephone number, but what they get is quite different.

And because smartphones are portable computers, it may not be obvious to the recipient that there is a difference between answering a traditional call and receiving a call which has come via OTT bypass.

It is no doubt that the future of telecom business is in data services and the earlier telecommunications providers embrace this reality the earlier they can start positioning themselves strategically to stay afloat in the industry. These developments in away relate to the shift from traditional banking services with Telecoms eating into banks revenues.

Just on 18th April 2016, MTN Uganda introduced the WebPhone app that allows its subscribers to make international calls to Uganda at local rates. Users can make calls over the internet from a PC, laptop, tablet, or smartphone.

Although the WebPhone app relies on the internet for the caller, it has an unprecedented ability of making calls to people without smartphones. The app is already available on Google Play although users have to register with MTN Uganda to start using it. Contact This email address is being protected from spambots. You need JavaScript enabled to view it. to sign up. Will the other Ugandan operators come up with similar offers? Well, only time will tell.

As a Fraud Examiner, I will not conclude without highlighting the challenges that the use of OTT apps bring when it comes to investigations. Initially, all one would need was a court order to obtain call detail records (CDRs) from the telecom operators to know who called who or sent SMS to suspects.

With the increasing use of OTT apps, all the telecom CDRs show in the volume of data (in kilobytes or bytes) consumed by the user. Most of the providers cannot even provide the actual IP address or websites visited by the target. To obtain communication details of a suspected fraudster using OTT apps, the investigator will have to request for these from the likes of OTT application providers. With the recent end to end encryption by WhatsApp, users can comfortably exchange photos, videos, voice messages and so on without fear of exposure from unknown third parties. The company claims that no one, not hackers, cyber criminals, governments, not even the company itself can obtain details of communication exchanged by its users.

We can certainly expect the use of OTT applications to increase even further.

SOURCE: SUMMIT BUSINESS MAGAZINE VOL. 08/ ISSUE 11, APRIL 2016