Service Providers don’t just provide services to consumer subscribers like you and me.  Service providers also provide a lot of services to enterprises. And the revenue derived from these services, such as text messaging, other messaging, and voice services, has declined as data usage has soared, the same trend they saw with consumer subscribers.  With data usage comes data apps that provide these services for “free” (though the subscribers are paying for the data usage). This typically results in the decline of traditional service provider voice and messaging revenue.

Their services are now undergoing “attack” from OTT players.  Perhaps the best example of this is Skype.  Many enterprises use Skype for Business for Instant Messaging, internal voice / video calling, and internal voice / video conference calls.  This is all done over the enterprise data network.  While there are some annoying foibles with this (like if two people are calling each other at the same time the call won’t go through – with the definition of same time being somewhat liberal with respect to say a traditional POTS landline call), it works and many enterprises are using it. 

However, the advent of OTT into the enterprise goes well beyond voice calling endorsed/directed by the IT department.  As an example, I also interact with customers globally.  Many of these customers use “regular” Skype when they want to talk to me, thus saving themselves international call charges. “Regular” Skype is not endorsed by my IT department for use, but since our customers want to use it, I use it. 

I am old enough to remember Blackberry dominance.  Our execs started to use it (the concept of mobile email to your phone was too much to pass up!) and while our IT department did not endorse it, eventually, they had to endorse it. 

So, the key here is value-added services. Service Providers need to provide value-added services in order to avoid becoming a bit-pipe. I’ll talk more about how to do that later this month.