E-Plus embraces OTT partnerships with WhatsApp SIM

German operator E-Plus this week unveiled a partnership with WhatsApp that provides one highly interesting example of how mobile operators and over-the-top messaging providers can work together in future.

Operators have long been considering various strategies to deal with the burgeoning over-the-top messaging market, as "free" messaging services eat into their voice and SMS revenues. After initially trying to resist the onslaught, operator attitudes are now thawing towards OTT messaging providers, as both Line and Nimbuzz told FierceWireless:Europe in a recent special report.

Line has been proposing various options to operators including the idea of Line data plans, which would allow free usage of Line messaging services within a separate data tariff provided by an operator.

WhatsApp and E-Plus look to have adopted a model along these lines but with bells on: WhatsApp is practically becoming a virtual operator on the E-Plus network through the launch of a prepaid WhatsApp SIM, although it is not a "true" MVNO in the sense of buying wholesale airtime from E-Plus and selling services directly to consumers. Under this new tariff, WhatsApp messaging is not counted against the user's included traffic volume in what is in effect a zero-rated proposition, and users can even use WhatsApp if there is no balance left on the card. The SIM card costs €10 ($13.79), but can be used as credit thereafter.

OTT messaging is essentially at the core of this new prepaid tariff, and not traditional communications services. While WhatsApp usage is free under the WhatsApp SIM, other voice calls, texts and data usage will incur a charge. Indeed, data usage beyond WhatsApp is a fairly hefty €0.24 per megabyte, while a voice call costs 9 cents a minute and texts are also 9 cents each. To counter this, E-Plus is also offering an additional option called WhatsAll. For €10 over a 30-day period, a user will get 600 flexible units that can be exchanged for an SMS, a one-minute call or 1 MB of mobile data. The credits do not roll over to the next month, however.

Of course, as Emma Mohr-McClune, service director for global consumer services at Current Analyst, points out, there is a fair usage policy: WhatsApp service usage over 1 GB in a 30-day period is subject to bandwidth reduction to 56 kbps thereafter. This type of bandwidth throttling is commonly practised in Germany. In addition, users can only continue communicating over the platform when credit has run out for the remainder of the 30-day period.

It's certainly a novel approach, and highlights WhatsApp's previously announced plans to engage more with mobile operators. For E-Plus, it's a way to somehow bring WhatsApp traffic within its own sphere of influence: indeed, Germany-based online publication androidnext noted that this is "quite a big deal" as WhatsApp is installed on 90 per cent of all smartphones in Germany, adding up to a WhatsApp user base of more than 30 million people.

Mohr-McClune notes that E-Plus is not the first operator worldwide to partner with WhatsApp, nor is it totally clear what revenue-sharing deal has been agreed. "But it is one of the first to co-brand a full, SIM-based mobile voice, minutes and data tariff, together with zero-rated WhatsApp usage, and this kudos will likely be recognized by German consumers and the wider industry alike," she said.

It's also an important move for Facebook, which recently acquired WhatsApp for $19 billion (€13.7 billion) and plans to use the app to drive forward its "mobile first" strategy, forming partnership with mobile operators where that makes sense.--Anne