Viber: We want to share revenues with wireless carriers

CEO talks OTT during Mobile World Congress, blasts joyn effort

BARCELONA, Spain--Viber CEO Talmon Marco said joyn--a rival messaging service being offered by some wireless carriers--will not be successful. Specifically, he said joyn is "no fun" and has "no future." He also said Viber is open to revenue-sharing deals with wireless carriers and he said the company recently signed its first carrier partnership with operator Axis in Indonesia.

Viber CEO Talmon Marco

Viber CEO Talmon Marco, left, discusses the company's service while Suk-Chae Lee, CEO of KT, Hans Vestberg, CEO of Ericsson, and René Obermann, CEO of Deutsche Telekom, (left to right) look on.

Marco made his comments during a keynote here at the Mobile World Congress trade show about the future of communications. His comments were particularly noteworthy considering Suk-Chae Lee, CEO of KT, and René Obermann, CEO of Deutsche Telekom, were onstage with him and both carriers support the GSMA's RCS-based joyn effort. Joyn is being pushed as a way for carriers to take back some of the revenues they have lost to "over-the-top" providers like Viber, Facebook Messenger and WhatsApp. In the United States, MetroPCS (NYSE:PCS) has launched joyn.

Marco said joyn services do not provide much more functionality than existing messaging services like Viber and others. He said joyn services remind him of the maxim that "a camel is a horse designed by committee."

The comments likely were especially biting to Deutsche Telekom's Obermann; DT last month said it will indefinitely delay the launch of its own joyn services due to technical problems.

During the keynote, Marco, Lee and Obermann discussed how wireless carriers can respond to OTT players like Facebook, Google, Skype and others. Operators have been losing messaging and voice revenues to OTT players that offer those services for free, a situation that some operators have railed against as unfair. "That is a fact of life and we need to deal with it," Obermann said.

Marco recommended that, instead of attempting to compete directly with OTT companies, carriers instead partner with them through revenue-sharing agreements. He said Viber's deal with Axis provides the carrier's users with access to Viber at a reduced price, and the carrier is then able to encourage those users to upgrade to more expensive data plans.

But Marco said Viber also is open to other types of agreements with carriers. For example, he said Viber could team with a carrier to offer enhanced voice calling over a carrier's voice network, and the two companies could share the resulting revenues from charges to end users. Marco hinted that some deals are already in the works: "Expect to hear some pretty cool things later this year," he said.

Marco said Viber now counts 175 million users and that the company's services cost $200,000 per month to run. He said the reason OTT services like Viber have been successful is because carriers have not been quick enough to innovate. "There's no difference between the SMS of 1993 and 2013," he said.

Marco also blasted the notion that messaging services like Viber are only used by young people in emerging markets who wish to avoid excessive carrier messaging fees. He said 90 percent of mobile customers in Monaco are Viber users; the average per capita GDP in Monaco is $178,800 and the average age is 49.

"Consumers want innovation," Marco said.

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