Voice-over-LTE won't take off until 2015, will have to compete with telephony apps

Analysts expect to see 12 commercial VoLTE networks with 8 million subscribers by year-end

The technology to implement Voice-over-LTE (VoLTE) is maturing, but mobile operators won't roll out telephony services in earnest until 2015. At the same time apps like Skype and Fring are growing quickly in popularity, according to Infonetics Research.

The main issues holding VoLTE back are business oriented, although there are also technical concerns such as integration with existing operations and business support systems, Infonetics said.

Alternative technologies are also allowing telephony over older networks to coexist with data over LTE.

"Operators are using another solution called circuit-switched fallback CSFB, and my understanding is that has worked better than operators had dared hope for. So what they are asking themselves is what VoLTE can do for them from a commercial perspective, and as it stands today that is not clear," said Mark Newman, chief research officer at another research firm, Informa Telecoms & Media.

CSFB allows smartphones to turn off their GSM or 3G radios to save battery while the 4G network is in use for Internet browsing, turning them on again to receive an incoming call when notification is received over the 4G network.

Adoption of VoLTE has been faster in some countries than in others. In South Korea, SK Telecom's VoLTE service had 3.6 million subscribers in April. Infonetics now expects 12 commercial VoLTE networks and 8 million subscribers by year-end, with about three-quarters of those in Asia Pacific, it said.

The market research firm isn't alone in thinking that the success of VoLTE in South Korea will help accelerate the implementation of the technology. Per Narvinger, head of equipment vendor Ericsson's LTE radio products division, said in a recent interview that the Koreans have showed it works well, and that has in turn increased interest globally. The Korean operators were helped by their national coverage, which meant they didn't have to rely on protocols such as Single Radio Voice Call Continuity (SRVCC) to hand over between the 4G network and older networks, according to Narvinger.

While VoLTE services find their feet, Internet-based voice services are becoming more popular. Such services, also known as over-the-top (OTT) services, include Skype, Fring, KakaoTalk, Line, Nimbuzz, WeChat and Viber. The number of mobile subscribers for these services shot up more than 550 percent last year to over 640 million, and is expected to approach the 1 billion mark this year, according to Infonetics. However, most are making very little money per user. In 2012, the average annual revenue per mobile user was a meager US$7.13, Infonetics said.

What operators are hoping for is that a combination of VoLTE, HD Voice and RCS (Rich Communications Suite) will turn out to be a more attractive proposition to consumers than just voice on its own, according to Informa's Newman.

The Rich Communication Suite (RCS) Initiative was announced in February 2008, with the purpose of turning the IMS (IP Multimedia Subsystem) framework, which is also the basis for VoLTE, into standardized services.

This year has seen a growing number of operators launch RCS services -- which include instant messaging, video chat and content sharing -- under the joyn brand. Services are now available in France, Germany, Spain, South Korea and the U.S. from the likes of Orange, Vodafone and Deutsche Telekom.

But not everyone is convinced RCS will help usher in VoLTE and let operators compete with online messaging apps.

"If you decide to develop an RCS solution it has to be extremely good and really be top telecom class and at the same time be able to compete with alternatives from OTT services. That is a tough challenge," said Tommy Ljunggren, vice president of System Development at TeliaSonera's Mobility Services, who wants more VoLTE-compatible devices and better 4G coverage across Europe before considering rolling out telephony over LTE.

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Mikael Ricknäs

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