WiFi helps pay-TV hit back at wireless operators, telcos

Pay-TV operators are getting their own back on wireless service providers and Telcos, chasing their customers with OTT services by enabling voice calling over WiFi, from anywhere in the world in some cases.

In the UK, MSO Virgin Media, the country’s second-largest pay TV operator with nearly 4 million TV subscribers, has just launched a smartphone app that allows customers to take advantage of existing landline calling plans when away from their home. Virgin Media says this is the UK’s first Wi-Fi calling service, allowing customers of its home/phone talk plan to make free calls over Wi-Fi whenever available — whether at a friend’s house or at a hot-spot abroad.

The app works by automatically detecting whether a Wi-Fi call is possible, and then whether it is included in the user’s home talk plan. Virgin Media has completed technical trials of SmartCall and has now made it available to selected customers, before launching it to all its phone customers early 2013.

This is an example of a pay-TV provider extending into new services and undercutting existing cellular companies, which, for too long, have got away with charging tariffs way higher than the underlying call cost. In the U.S., Comcast, the world’s largest MSO, came in earlier with its Voice 2go service for its Xfinity Voice home phone customers, launched in May 2012. This enables subscribers to make calls and send texts via Wi-Fi networks. In that case, calls can also be made using a 4G or 3G wireless data plan without consuming wireless minutes.

Several mobile operators have also launched Wi-Fi calling, recognizing they need to get into this market even at the risk of cannibalizing existing revenue. Among these are: T-Mobile US, Orange UK and Rogers Wireless in Canada.