Business model analysis

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5. Business Model Analysis

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Revenue Models Across Layers

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Layer 1: Telephony/SIP (Commodity Pricing)

Typical Pricing:

• Inbound calls: $0.0085-0.025/minute (US);$0.003-0.008/minute (India)
• Outbound calls: $0.01-0.03/minute (US);$0.004-0.012/minute (India)
• DID rental: $1-3/month per number (US); ₹50-150/month (India)
• Setup fees: $50-500 (often waived for volume)

Margin Structure:

• Wholesale termination: 5-15% gross margin
• Retail SIP trunks: 25-40% gross margin
• Value-added services (fraud, analytics): 60-75% gross margin

Key Drivers of Profitability:

• Scale: Per-minute margin is thin ($0.002-0.008); profit requires massive volume
• Network ownership: On-net calls (Bandwidth) avoid wholesale costs
• BYOC attach: Software margins (APIs, dashboards) higher than minutes
• International routing: Cross-border calls carry 2-3× margins

Example Unit Economics (US SIP Trunk): India Difference: Lower per-minute pricing ($0.004-0.008) requires 3-5× volume for comparable revenue. Indian providers compensate with:

• Bundled connectivity (Airtel, Jio) capturing network margin
• Lower CAC (inside sales vs. US field sales)
• Compliance services (DLT) as margin enhancer

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Layer 2: Voice-AI Infrastructure (Usage + SaaS Hybrid)

Typical Pricing:

• CPaaS voice APIs:
  • $0.0125-0.04/minute (Twilio, Daily)
  • $0.008-0.02/minute (Indian players)
• WebRTC infrastructure:
  • $0.004-0.008/participant-minute
  • $99-499/month platform fee
• Recording/transcription: $0.005-0.015/minute add-on

Margin Structure:

• API minutes: 50-65% gross margin
• Platform/SaaS: 75-85% gross margin
• Storage/transcription: 40-50% gross margin (cloud costs)

Unit Economics (WebRTC SaaS): Why Margins Are Higher:

• Developer-facing: Lower-touch sales vs. telco relationships
• Cloud-native: No physical infrastructure (vs. Layer 1 POPs/switches)
• Stickiness: API integration = high switching cost

LiveKit/Daily Disruptor Model:

• OSS core = land (free community edition)
• Managed cloud = expand ($99-999/month)
• Enterprise = harvest ($10k+/month + professional services)

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Layer 3: Voice-AI Agents (Value-Based Pricing)

Typical Pricing:

• Per-minute: $0.15-0.40 (US);$0.05-0.15 (India)
• Per-interaction: $0.50-2.00 (resolution-based)
• Subscription: $5k-50k/month (enterprise seat-based)
• Outcome-based: % of cost savings vs. human agents

Margin Structure:

• Gross margins: 55-75% (depends on LLM costs)
• LLM inference cost: $0.03-0.08/minute (falling 30% annually)
• TTS/STT cost: $0.01-0.03/minute
• Contribution margin: 40-60% after cloud/model costs

Unit Economics (Autonomous Agent Provider): Why Agent Economics Beat Infrastructure:

• Value capture: Customers pay for outcomes (deflected calls, faster resolution) not just infrastructure
• Displacement pricing: AI at $0.15/min competes with human agents at$5-8/min-customers see 95%+ cost reduction
• Vertical moats: BFSI/healthcare models with compliance = higher pricing power

India Agent Economics: Critical Difference: Indian customers have lower willingness to pay but higher volume tolerance. Strategy must be land-with-volume, expand-with-features.

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Margin Cascade: Why Layer 3 Captures Most Value

The Integrated Play: Owning Layer 1 → 3 end-to-end allows:

• Capturing full $0.40/minute (vs.$0.015 for SIP alone)
• Eliminating inter-layer revenue sharing
• Controlling latency end-to-end (competitive advantage)
• Cross-subsidizing Layer 1 commoditization with Layer 3 margins