The international voice market's trajectory is an inexorable downward spiral, and “over-the-top” (OTT) communications services are most certainly the main culprit.
For those unfamiliar with the term, OTT traffic is that which reaches users directly through the internet, bypassing other conventional methods.
Remember Skype? Launched in 2003, Skype was the dominant OTT communications application for computers. Since then, a new generation of smartphone-based communications applications has emerged.
Our International Voice Report estimates that seven OTT communications applications—WhatsApp, Facebook Messenger, WeChat, QQ, Viber, Line, and KakaoTalk—combined had roughly 6 billion monthly users in September 2024.
Our International Voice Report estimates that seven OTT communications applications combined had roughly 6 billion monthly users in September 2024.
These estimates exclude other apps, such as Apple’s FaceTime, Google Meet, and Skype (the latter two of which have over 1 billion downloads from Google’s App Store).
It's difficult to pin precise numbers on the volume of international OTT communications. However, a simple thought experiment helps to illuminate its likely scale.
Between 1983 and 2007, international phone traffic grew at a compounded annual growth rate (CAGR) of 15%, and traffic grew an even faster 21% CAGR between 1927 and 1983.
It's hard to believe then that the recent decline in traffic means that people have lost interest in communicating with friends and family abroad. Rather, it suggests that they are turning to other means of keeping in touch.
TeleGeography has fairly reliable estimates of Skype’s traffic through 2013, when the company carried 214 billion minutes of on-net (Skype-to-Skype) international traffic. Telcos terminated 547 billion minutes of international traffic in 2013, and OTT plus carrier traffic totaled 761 billion minutes.
We had been assuming that total (carrier plus OTT) demand for international communications was growing at a relatively modest 13% annually since 2013. For this analysis, we further assume that texting, video, and email have quite recently eaten into overall voice growth, and that this annual growth gradually glided down to 0% by 2023.
A bit of arithmetic would tell us that the combined volume of carrier and OTT international traffic would have expanded to 1.6 trillion minutes in 2023. (The figure below illustrates this nicely.)
Where Did the Minutes Go?
Traditional carrier traffic has slumped, but OTT traffic has risen to fill the void.
This calculation suggests that cross-border OTT traffic overtook international carrier traffic in 2016, and would exceed 1.3 trillion minutes in 2024, dwarfing the 305 billion minutes of carrier traffic we projected.
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