Bypassing Goliath

From June Vodafone UK have decided to introduce a new pricing system that has been designed with VoIP and P2P in mind. By ‘in mind’, I of course mean that it has it in mind to stop the use of VoIP and P2P.

As has been raised in numerous articles and blog entries before, including here, the fact is that the adoption of many of the data related services that we’ve been promised over the years have been retarded by the operators themselves. Whether they like this or not, much of this comes down to the aggressive nature of their market – which is not surprising, given that when you face ongoing churn rates (the loss of existing customers to other networks) of 30% or more, you will tend to approach business with a “take no prisoners” mentality.

Unfortunately data services, be they value-added SMS, mobile Web or the like, are not the same as voice services where this approach has proven successful. This is because they need an additional layer of input to the proposition; a content or service provider that gives value to the service in question, and in this regard most operators have failed miserably, preferring to take the lion’s share of a small biscuit than a healthy slice of a much bigger pie.

The problem with this approach, other than harming the market it should be nurturing, is that it cannot ultimately stand in the way of innovation. Put an obstacle in peoples’ way and they will eventually find a way to get around it. And so VoIP and P2P services are actually very difficult to stop without significantly affecting customer services (Vodafone’s new pricing system does not explain how it intends to identify such traffic, for example) and with the advent of WiFi based, 4G networks, such as the one recently announced by DigiWeb in Ireland, we’ll increasingly see the operators bypassed. All of which adds up to a pretty grim future for the operators where it comes to their long-term market share of data services.

Not before time, to be honest.

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