PUSH TO TALK: New Voice Magic?

Till a decade back, US operator Nextel was the only one offering push-to-talk
(PTT) service, and Motorola the only vendor with a major interest in the
technology. However, in late 2003 and 2004, several mobile operators across the
world (including two in India) and technology vendors hitched on to the PTT
bandwagon. Today PTT is one of the hottest topics in the wireless industry and
it is estimated that around 30 operators worldwide, most of them outside US,
offer PTT services.

A few trends are on the horizon in the PTT business. First, while Nextel
(soon to be merged with Sprint) mainly focused on business users, new PTT
operators are taking a more mass-market approach. They believe that the ability
to connect instantly would make push-to-talk popular. In fact, Nextel too has
started to look at its Direct Connect brand of PTT offering as a service for
everyone-one reason why it is now extending Direct Connect to the whole of
continental US. Extension of the service to mass market could mean that people
would start using it more for person-to-person communication than just for
business communication.

Operators launching PTT are bringing-in new features and capabilities as well
as expanding its reach and coverage. For example, Orange's 'Talk Now'
offers users the option to specify their availability and to put their handset
into silent mode. Nextel is making its services available across the US in order
to broaden its appeal and to take on the new competition. Until recently, it was
available within local service area only.

Operators are keen on PTT as they are convinced that it would surely help
them increase their ARPU. There is also the lure of new revenue streams from
voice, by positioning PTT for a specific set of users and pricing it lower than
cellular voice. Orange sees it as a key for accelerating growth across the group
and believes that voice would get even stronger with its 'Talk Now' PTT
offering. Similarly, Fastlink of Jordan sees PTT as a service that would help it
retain market leadership. Interestingly, Orange also sees push-to-talk as a
substitute for SMS, for people struggling with text messaging. But mostly, PTT
is an attempt to boost ARPU-after all, the entire mobile user base can be
targeted once all mobile handsets have the PTT feature.

According to a recent report by In-Stat, the number of PTT and PTT Over
Cellular (PoC) subscribers will grow at a steady pace in the next five years.
The US subscriber base will grow from 16.8 million at the end of 2004 to 33.6
million at the end of 2009. Faster growth is anticipated in markets outside the
US. According to In-Stat, the majority of growth will come from continued
expansion in the business market and moderate uptake in the consumer market,
especially youth.

The report also stated that PTT/PoC is becoming more of a mainstream
Value-Added-Service , such as Caller ID and voice mail, a commodity that
cellular providers can offer to their customers for an additional fee, over and
above the price of traditional voice communication.

Ravi Shekhar Pandey