How "Unlimited Voice" Impact Indian Operators

Introduction

With the advent of 4G, tariff plans offering "unlimited voice" has become a norm in India. It was initially triggered by RJIO but, now all operators are offering it. The cheapest plan of this kind requires a subscriber to pay a fixed monthly fee of Rs 149 only for all calls that are made within the operator's own network. However, RJIO's subscribers face no such restrictions. For them, "unlimited voice" packs also include calls made to a subscriber of a competing operator's network, as long as these calls are restricted within India. The other operators are also offering similar plans but at a much higher monthly fee. But, why did a 4G operator took the lead in offering "unlimited voice" plans and not others? Is he not scared of "network congestion" driven by excessive usage? To evaluate the risks one needs to understand the characteristics of a 4G voice call and compare it with one that is carried over 2G.

VoLTE is Efficient

4G networks are optimized for carrying data. It is significantly more efficient in offering huge data capacities. Voice is carried over 4G network as data. Technically it is called VoLTE (Voice over LTE). Voice in the LTE form is packetized, unlike 2G voice which is "circuit switched". In layman's term, "circuit switched" voice calls are inefficient as it blocks network resources even when the line is held unused (parties have paused for thinking). On the other hand, in a similar situation, packet switch calls frees up resources dynamically for other users, thereby significantly increasing network efficiency. Also, 4G technology uses more advanced techniques for increasing efficiency, which is not supported by 2G. Typically, data rates for circuit switched voice calls vary between 6 to 24 Kbps (KiloBits/Sec) depending upon the type of vocoder used (higher vocoder rates result in better quality). Calls with higher bitrate will need more network resources to carry it. To map the impact on 4G network, the bitrate of voice calls needs to be converted to MB (MegaBytes). That's what I plan to do next.

VoLTE vs 2G Voice

One Byte consists of 8 bits, hence 6 to 24 Kbps (KiloBits/Sec) will translate into 0.75 to 3 KiloByte/Sec (dividing by 8). This is equivalent to 45 to 180 KiloByte/Minute (1 minute = 60 Secs). Typically an average voice user ends up consuming around 400 minutes worth of network time in a month. Hence, in a month anything in the range of 18000 to 72000 KiloBytes will get consumed. This translates into 18 to 72 MB (MegaBytes) per month. Thus, the consumption on account of voice is a small fraction of the size of the data packs being offered by the 4G operators. Even the lowest plan of Rs 149 offers a data pack of 300 MegaBytes which is four times that maximum data consumed on account of "unlimited voice" for the vocoder with the highest bitrate.

Impact on Operators

Hence, for a 4G operator, voice ends up consuming a very small fraction of the network resource compared to what is used to offer data. This is why the cost of carrying voice on a 4G network is much lower compared to a 2G network - where the network resources have to be increased linearly with rising voice calls - resulting in more investments - making it difficult for a 2G operator to offer "unlimited voice". Also, the 2G operator will have to re-farm their 900 MHz spectrum for LTE as VoLTE works best in a lower frequency spectrum band.

However, a 4G operator running voice as data will face some challenges too. They will find it difficult to offer "sachet plans" with a higher validity period. As if they do, then the subscribers will end up using the data offered for making voice calls (4G voice consumes very little data), resulting in decreased ARPUs (Average Revenue Per User). The other challenge is the inability of the legacy 4G handsets to support VoLTE, and hence new VoLTE capable 4G handsets have to be seeded in the market. Also, unless the IUC (Interconnect Usage Charges) is lowered or brought to zero (currently it is set at 14 paise/minute to be paid by the called operator), the 4G operator offering free voice will have to recover this cost from his customer by increasing the price of data pack offered. IUC cost can be reduced if the VoLTE calls are interconnected at the IP level than at the PSTN level (currently all VoLTE calls are transcoded to PSTN calls before interconnecting with the other operator's network).

Conclusion

To conclude, to offer "unlimited voice" without much constraint, an operator has to move its 2G voice on LTE (i.e offer VoLTE). However, the 2G voice on GSM can be offered with a lower validity period compared to the 4G voice running on VoLTE. A 4G operator will find it difficult to offer "sachet plans" with a higher validity period for reasons explained earlier. He will also be challenged by 4G legacy handset's inability to support VoLTE and the current inefficiencies of 4G calls interconnecting between operators.

(Views expressed are of my own and do not reflect that of my employer)