Should Telecos Worry About Facebook Inc (NASDAQ:FB)’s ‘Phone.’

After WhatsApp disrupted the tele companies texting revenues, it’s Facebook Inc (NASDAQ:FB)‘s turn to do the same, but this time with voice. The social networking giant accidentally revealed that it is running a test on a new app called ‘Phone’. It could be seen as one more attempt by the Facebook Messenger company to poke its nose in telecompanies’ business.

Have analyst identified a ongoing trend in FB?

Blocking calls

So far, the app is developed for Android, which will show information about the caller and will automatically block calls that are commonly tagged as undesirable. Facebook Inc (NASDAQ:FB)’s efforts with Phone is likely to be restricted to Android as Apple Inc. (NASDAQ:APPL) maintains a closed system. The app is believed to function as a native dialler, which will coordinate with the tele companies’ voice network. The app will differentiate itself from the company’s voice services available with Messenger, which requires the users at both the end to use same Facebook feature and the calls can take place only through Wi-Fi or mobile carrier network.

Targeting voice revenues

It is speculated that the app will help people filter unwanted calls made to their phone number and will be more than a connection between Facebook users. If the app gets a positive response, then it will act as a final nail on phone companies’ coffin. Where WhatsApp has already robbed the telcos of their SME revenues, they will least expect Facebook Inc (NASDAQ:FB) to do the same with voice. Phone companies have two options, that is, either to prepare and beat the app or keep hope that the app will turn into another failed experiment by the company. It will only be future that will decide how things take shape, but, one should believe that Facebook Inc (NASDAQ:FB) will not take a big risk like this without a proper plan in place.

About the Author

Terrel is US Markets Daily's business news reporter. She joined US Markets Daily after five years as a print reporter.

Leave A Response