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THE combination of Internet telephony and 3G services will force mobile operators to look at new business models. With 3G high-speed mobile broadband, users will be able to make local calls from the mobile phone via Net telephony which may erode mobile operators voice revenues. Experts say India is moving towards a scenario where voice will become dirt cheap, forcing operators to look for revenues from data services like banking, gaming, multimedia messaging, e-commerce, mobile TV and so on.

Further more, once WiMAX kicks off, consumers will be able to make Net telephony calls from WiMAX handsets, which may make long-distance voice ARPUs decline further. “We can see quite a bit of competition from Internet telephony from mobile once 3G kicks in.Further more, WiMAX as a technology will mature in 3-5 years, bringing down prices of WiMAX handsets. WiMAX base stations may be in place, which will further increase penetration of Net telephony through mobile WiMAX broadband,” says Kunal Bajaj of BDA Connect, a telecom research firm.

Already, telecom stocks plunged to their monthly low on Tuesday a day after the announcement of Trai’s policy on Net telephony. Bharti Airtel stock touched a low of Rs 785 on Tuesday from this month’s high of Rs 869. On the other hand, Reliance Communications stock plunged to Rs 396 on Tuesday from this month’s high of Rs 454 while Idea Cellular declined to Rs 81.90. Says ComFirst India director Mahesh Uppal, “Disruptive technologies like IP telephony and NGN (Next Generation Networks) will force operators to do a rejig of their business models. While net telephony will impact operator revenues adversely, 3G data services will make a positive impact. We will see high-volume usage of voice calls. Currently, data services form a negligible portion of operator revenues, but this will also increase.”

Analysts expect larger revenues from unlimited calling plans rather than traditional recharge plans for long-distance calling.Mr Uppal, however, sees WiMAX being a competitor only in the long term (3-4 years). “The technology has not matured as yet. But in the short term, we will see the return of peakhour low-rate calling plans,” he adds. Net telephony will also proliferate Wi-Fi zones. If DoT accepts Trai’s recommendations on Net telephony, then consumers will also be able to divert incoming and outgoing calls through Wi-Fi built in GPRS phones.

Internet Service Providers (ISPs) claim that they can offer free local calls in case of own IP networks and 10 paise in other IP networks. “STD call rate can be offered at around 15 paise and in other IP networks at about 25 paise. Net telephony application will also increase the broadband penetration, especially in rural India,” says ISPAI president Rajesh Charria.