Economics of Video Telephony and VoIP over EV-DO Rev A; A Service Provider Value Proposition

The powerpoint presenstation discussed the higher voice capacity and data throughput enabled by the greater spectral efficiency of EV-DO over Rev A enables profitable new services, in addition to improving network costs. In the case considered, VoIP over EV-DO Rev A has a 5-year NPV of $585 million, relative to circuit-switched voice over 3G1X, over 2009-2013. This value is critically sensitive to ARPU generated by the simultaneous voice and data charge, the timing of VoIP deployment, and the handset subsidy required for VoIP deployment, but it is positive for wide range of parameter values. In the case considered, Video Telephony generates 5-year NPV of $297 million over 2009-2013 as a standalone service. This value is sensitive to VT minutes of use, VT penetration rate and VT Price/min, but remains positive for a wide range of parameter values.