From the SIP Trunking Experts

December 02, 2013

The Young Are Abandoning Voice in Favor of Data Services

By Mae Kowalke SIP Trunking Report Contributor

Voice calls aren’t going away, but younger cellular users are realizing that they can cut their bills and increase their communications power by using over-the-top services such as Skype and WhatsApp.

South Africa is a good example of the global trend.

Among those between the ages of 19 and 24 in South Africa, spending on voice calls is declining as data use is on the rise, according to a recent study by World Wide Worx. The demographic is only spending 56 percent of its mobile budget on voice at present, down from 66 percent just a year ago.

At the same time, data spend is up in South Africa; it has climbed from 17 to 24 percent over the same period.

A version of the trend also can be seen in the South African market overall; the percentage of a user’s mobile budget that goes to voice has declined from 73 percent to just 65 percent today, with data rising from 12 percent of the overall budget to 16 percent. In 2010, voice accounted for 77 percent.

Over-the-top (OTT) apps such as WhatsApp are part of the explanation.

The World Wide Worx study found that OTT has shot up from 26 percent use to 53 percent over the past 18 months. The study also found that 10 percent of those surveyed who don’t currently use WhatsApp have plans to start using it in the coming year.

Also popular is Facebook Chat, which is used by 45 percent of those surveyed. Also popular in South Africa are Mxit, with 25 percent adoption, and BlackBerry Messenger, which rose from 17 percent to 21 percent owing to the popularity of the smartphone manufacturer’s brand in the region.

“Although SMS remains pervasive, new communication channels are being opened up to the mass market through both social media and instant messaging (IM) apps,” World Wide Worx’s Arthur Goldstruck told South Africa’s Tech Central recently.

SMS spending has flattened at 13 percent of mobile spending, he noted.

“Already, we are seeing a flattening of the curve of data use from the 25-34 age group through to the 46-55 age group,” he said. “Only above 55 does data spend drop off, but not very significantly.”

According to the study, a tipping point has already been reached in South Africa when it comes to app use. Roughly 51 percent of urban cell phone users use mobile apps, with rural markets catching up and with the current adoption rate of 27 percent.

While market conditions vary by country, with apps such as Blackberry Messenger being more popular in places such as South Africa than they are in the U.S., the trend overall is clear: Voice is giving way to IP-based calling solutions.

Edited by Cassandra Tucker
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