Voice has become the Rodney Dangerfield of wireless. It no longer gets any respect as operators and customers alike focus on text and data services.
There's no denying mobile talk time is losing popularity, supplanted among younger customers by texting, social networking and other data use. U.S. mobile customers averaged 826 minutes of voice use per month during 2007, the year when voice usage peaked, but that average plummeted to 681 minutes at the end of 2011, said a recent Wall Street Journal article, which quoted numbers from CTIA.
Nonetheless, I would argue that 681 minutes is 40,860 seconds more than zero, so talking over a mobile handset still has some legs. Not only that, a new study from research firm iGR, which surveyed more than 1,000 U.S. consumers, revealed that despite the growing focus on smartphones and data usage, "voice network quality is the factor end users consider most when rating their operator."
Yet even AT&T (NYSE:T) CEO Randall Stephenson apparently sees mobile voice as a product dying on the vine. He recently stated during an investor conference that the market might be ripe for someone during the next two years to introduce a wireless plan that offers data only with no voice option. That's not too farfetched, particularly as VoIP apps make it easier to call someone via the Internet rather than a circuit-switched connection.
Such a scenario is even more likely as operators shift to pricey unlimited talk and text plans--as Verizon Wireless (NYSE:VZ) has done with its new Share Everthing plans. This shift is occurring not because customers are making more phone calls but for the exact opposite reason: Customers are using less voice minutes and, thus, are increasingly likely to subscribe to lower-tier call packages, slashing the revenue operators used to derive from big-bucket calling plans.
Such a move will surely chase some customers into the arms of a data-only offering from an MNO or MVNO, as Stephenson envisions. At the very least, it would set a few consumers searching for a cheaper plan such as the prepaid service offered by Walmart and T-Mobile, which delivers unlimited text and data with only 100 minutes of talk time for $30.
I expect most customers want to continue using mobile operator's voice networks, mainly because making a call on them is easy, and ease of use is a humungous selling point even if one doesn't make a lot of calls. Circuit-switched voice, however, can be a real spectrum hog, so it's no wonder operators are eyeing VoHSPA and VoLTE.
Although those VoIP alternatives are coming down the pike, the migration to them is going to take years. Every mobile handset being used today and every handset currently being sold provides for circuit-switched voice calling. And for the foreseeable future, voice calls made while roaming will likely be sent over circuit-switched networks even if the user's home network enables VoHSPA or VoLTE calling.
So operators and their suppliers must find ways to make circuit-switched voice calling more efficient. InToTally and Qualcomm (NASDAQ:QCOM) are two companies tackling WCDMA voice efficiency from different angles, with the former offering its proprietary technology and the latter making a pitch to include technology revisions in 3GPP's Release 12. I took a look at both of these companies' approaches in a recent FierceBroadbandWireless special feature.
The fact that these companies, and others, are working to improve the spectral efficiency of circuit-switched voice shows that the mobile market realizes plain-vanilla voice service is still important, even if it's not as sexy as the latest data offering. It turns out that voice is getting some respect, and much-needed attention, after all.--Tammy