ABU DHABI // Etisalat and du’s business ideas are outdated and they could profit by looking at businesses overseas and freeing up internet-based calling services, experts say.
The two telecoms companies blocked Snapchat’s voice calling feature this month, but experts said that internet calls were here to stay and telecom companies should allow the call operators to operate freely. Rafid Fatani, head policy analyst at technology consultancy Access Partnership, said internet voice calling “doesn’t have to be a money-losing proposition for telecom operators”.
Etisalat and du are the only licensed operators in the UAE permitted to offer voice calling over the internet, known as VoIP. The free-to-use video and voice calling feature of Snapchat, the social media app, was blocked by them after an app upgrade introduced the feature.
Both Etisalat and du have said that any company wishing to provide VoIP services should coordinate with them.
However, a Snapchat official said there was no contact between the app and the two telecoms giants or were there plans in place to cooperate, meaning the feature would remain blocked, as was the case with similar services.
Mr Fatani said Etisalat and du should see how operators overseas were adapting to the 21st century telecommunications landscape, where digitisation was transforming the way people communicated.
“Successful telecom operators in developed economies have realised that these services are here to stay, and have figured out ways to monetise them without the need to block them,” he said.
So-called “over-the-top” mobile apps – such as WhatsApp and Viber which bypass conventional communications – may push mobile subscribers to opt for smaller voice and text plans, he said. However, the proliferation of VoIP services resulted in customers requiring more data.
“Understanding the shift in user behaviour should help telecom operators to cash in on these new trends,” he said.
He said alternative approaches for telecoms firms to recoup revenues include pricing data by speed and developing their own apps to compete directly – something he said Etisalat has done with its C’Me video and voice calling app.
Mr Fatani said he was not advocating one approach over the other, but said it was “important however not to stifle innovation, and maintain the UAE’s image as that of a global developed market player”.
The restrictions placed on Snapchat drew heated comments from one Federal National Council member, who said he was “embarrassed” with how the restrictions made the UAE appear in the international sphere.
Present at the session was Hamad Al Mansouri, head of the Telecommunications Regulatory Authority, who said Snapchat’s voice calling features were blocked because of security concerns, while reiterating the positions of du and Etisalat.
Mr Al Mansouri added the UAE was not the only country that placed restrictions on such apps, and said Morocco had also recently blocked voice calling.
In January, regulatory authorities in the North African country, whose sector is dominated by players such as Maroc Telecom, of which Etisalat owns a majority stake, began blocking calls made through mobile internet connections.
The Moroccan regulator offered similar reasons to those made in the UAE, but also said internet calling was putting a dent into the revenues of operators.
Matthew Reed, the Dubai-based practice leader for Middle East and Africa at telecom consultancy Ovum, said the large number of expatriates in the UAE and its status as an international business centre made international calling a key revenue component for the telecoms companies.
Adjusting their business models could help the operators mitigate effects on their revenues, he said.
“If the restrictions were lifted and they were offering more attractive calling packages, they might find they won’t lose out by lifting the restrictions,” he said.
“Despite the restrictions, many people are using alternative calling technologies anyway, to the detriment of operators,” he said.