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Summary

On September 3, 2015 T-Mobile launched a video calling service, having launched RCS-based advanced messaging services in July and VoLTE services in 2014. Although it was not the first carrier in the US to launch video calling – Verizon did so when it launched VoLTE services in September 2014 – T-Mobile’s move does show how carriers can finally start to generate new revenues from their massive investments in VoLTE and IMS.

T-Mobile customers will pay for video calling

T-Mobile’s video calling service uses data from its customers’ data allowances, although presumably only on LTE and not Wi-Fi. This means that they are effectively paying for video calls on LTE. This is in stark contrast to VoLTE calls, which are more or less free in the US, given that traditional mobile voice calls are practically free. Here T-Mobile is taking the same approach as Verizon, which also charges for video calls while not charging for VoLTE calls.

Vendors have long told carriers that they need to make massive investments in IMS and VoLTE to play a role in messaging before all such services disappear to Skype, WhatsApp, FaceTime, Facebook, KakaoTalk, and all the other OTT providers. They sold these investments with the promise of new revenues from advanced messaging services, video calling, and so on. With the launch of video calling (and advanced messaging services), that promise of new revenues from IMS and VoLTE will start to become reality.

The new T-Mobile video calling service has a number of advantages. It is integrated into the phone dialer, meaning that video calls are another option alongside voice calls, with no need to download an OTT app such as Skype or WhatsApp. According to T-Mobile, the service also works seamlessly on and between LTE and Wi-Fi and when users move out of LTE or Wi-Fi coverage the video call seamlessly turns into a voice call. When they move back into LTE or Wi-Fi coverage they can restart a video call with a click. In addition, because the service is based on T-Mobile’s VoLTE/IMS platform the video calls should have network-based quality of service, although T-Mobile did not focus on that point in its announcement.

However, the video calling service also has a number of disadvantages. For example, at launch it works on only two devices, the Samsung Galaxy edge+ and the Samsung Galaxy Note 5, although software updates will be available next week for the Samsung Galaxy S6 and Galaxy S6 edge. Even so, that is just four devices supported out of a portfolio of close to 40; T-Mobile says another three devices will support video calling by the end of 2015, for a total of seven. In addition, Apple will not rush to support carrier video calling services on the iPhone, given the popularity of its FaceTime app for video calling between Apple devices.

Furthermore, T-Mobile’s video calling works only between T-Mobile customers (if they have the right devices). That covers T-Mobile’s 59 million subscribers, but if they want to call one of the 327 million US subscribers not on T-Mobile, they will have to wait until the carriers resolve the issue of interoperability.

Appendix

Further reading

“T-Mobile leapfrogs AT&T to offer free pan-North America calling and roaming,” TE0001-000976 (July 2015)

Verizon Consumer Update, June 2015, TE0001-000969 (June 2015)

Wi-Fi Calling: T-Mobile’s “Wi-Fi Unleashed” initiative, TE0001-000891 (November 2014)

Author

Mike Roberts, Practice Leader, Americas

mike.roberts@ovum.com

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