Jolt for the Big Guys

Because SA cellphone operators have slashed their data rates voice calls using PTT could cost as little as 2,5c/minute.

Do you think MXit, the instant messaging software for cellphones, is a disruptive technology ? New software being developed by small, Pretoria-based company could transform cellular voice communication and revive fixed-line operators.

A new technology being developed by Luuk, a software company based at the Information Hub in Pretoria, is promising to do for cellular voice telephony what MXit has done for mobile instant messaging. And, if it gets this right, it could transform cellular communications in the next few years.

The software is the brainchild of Luuk’s Tobie Van der Spuy. It exploits a little-used feature on modern mobile phones known as push-to-talk (PTT), which allows consumers to use their cellphones in much the same way as they would use a walkie-talkie.

The cellular operators already offer PTT but few people use it – it’s not easy to set up and communication between dissimilar handsets is not possible. Now, Van der Spuy is hoping to make PTT easy to use and, more importantly, a dirt-cheap way of communicating.

What exactly is PTT ? Unlike regular cellular phone calls, which use “full-duplex” communications in which the caller and the receiver of the call can hear each other at the same time, PTT uses “half-duplex” transmissions.

Push a button on your phone, say something, release the button, and the called party will receive the voice transmission, just as they would if they were using a walkie-talkie. The voice is transmitted over the cellular provider’s data networks – GPRS or 3G.

Though local mobile operators already offer PTT, it costs users 35c/message and it works only between handsets that run the same operating system. Van der Spuy and his team have developed a small software application that works on any handset and that will allow consumers to send cheap voice messages to one another – no matter where in the world they are.

Luuk, which has partnered with former UUNet MD Paul Dinsmore, is in talks with local and international fixed-line and cellular operators and hopes to clinch its first deal soon.

Because Luuk has adopted open standards – it uses the same Jabber instant messaging protocol as Google Talk – it will also be possible for PC users to chat to mobile phone users and vice versa.

Best of all, though, is the price. Operators may charge users a small monthly subscription or a one-off fee for the software, but call costs will be dirt cheap. Because SA cellphone operators have slashed their data rates – Virgin Mobile charges only 50c/MB – voice calls using PTT could cost as little as 2,5c/minute.

MTN and Vodacom customers who do not subscribe to a data bundle could pay just 10c/minute (R2/MB). Compare that with the more than R2,80/minute levied on prepaid users for voice telephony and the attraction of Luuk’s offering becomes clear.

Van der Spuy believes that these tariffs are so low they could attract millions of consumers who previously could not afford mobile telephony.

The mobile operators, though, won’t be happy to see their voice revenues cannibalized. MTN has already threatened to impose penalties on anyone who uses its data network to make voice calls. The company has warned that it could even terminate customers’ contracts.

Vodacom has taken a much more enlightened approach and, though it hasn’t ruled out imposing higher fee on voice carried over its data network, it has said it will turn a blind eye to it for now.

Ironically, it is fixed-line operators that could benefit the most. By making available a Telkom-branded application on people’s cellphones, Telkom could muscle its way into the mobile market. OR imagine an MTN-branded app residing on Vodacom subscriber’s phone. This could get interesting.

Source : Duncan McLeod, Financial Mail - www.mybroadband.co.za