Dialogic Blog

OTT is / is not a threat to interconnect carriers

by Jim Machi

May 27, 2014 8:02:01 AM


Two weeks ago, I traveled to Chicago to attend International Telecoms Week (ITW), the annual meeting for the wholesale telecommunications community. One morning, I was reading the show news daily and sipping my morning coffee when I came across an interesting article. It was about whether the wholesale market thinks over-the-top (OTT) technology is a threat or an opportunity. The article cited a Capacity Magazine survey that showed 82 percent of the wholesale market leaders surveyed see OTT as an opportunity.

Why was this question asked in the first place? The answer has to do with VoIP. The rise of VoIP means less TDM traffic—the traffic that built this industry in the first place. Plus, with Skype, and soon WhatsApp, VoIP traffic can be peer-to-peer, which means that all traffic exists over the top of a data network. This in turn leads to less voice traffic and tighter margins, leaving the wholesale industry with a new environment to navigate. 

That being said, OTT is a huge opportunity for wholesalers. First of all, OTT traffic brings all kinds of newtraffic, from video to HD Voice to WebRTC. This is what we refer to at Dialogic as rich media. All of these codecs would likely require transcoding, and wholesalers will very likely want to make deals to support this traffic. 

Take Google Voice traffic, for example. Carrying Google Voice traffic would mean you’d need to be able to handle Opus audio technology, and it doesn’t stop there. Rich media traffic will likely be a growth market, so it would probably be necessary for you to support and transcode all the various types of rich media.

And wouldn’t the OTT player want to be able to carry its traffic to other places, too? Off-net may prove to be a revenue stream for these companies, and while the OTT community wants to focus on smart handsets (basically mini computers), other technologies will factor in, as well.

If this year’s ITW was a sign of things to come, the industry is in for some exciting changes. The rise of OTT traffic will likely lead to interesting new partnerships and business opportunities. The wholesaler networks need to be ready.

For more tips and details about how we can make the most out of the OTT traffic opportunity, contact us at sales@dialogic.com.