Fixed line VoIP market to generate $40 billion a year by 2015

Voice over IP now has over 120 million subscribers worldwide, according to the latest analysis from Point Topic.

Its growth looks set to accelerate as predictions indicate a $40 billion annual VoIP market by 2015.

Global VoIP market grew by 12.6 percent during 2010 and shows that there is plenty of headroom left for VoIP around the world.

“The growth of VoIP has been bumpy but shows signs of acceleration,” said John Bosnell, senior analyst at Point Topic.

“VoIP
has all the hallmarks of a classic substitution commodity. This is
where customers look at the service that is delivered by a new product
and decide that it meets, or exceeds, the service they are currently
receiving and when it is appropriately priced they will switch from one
to the other,” Bosnell added.

Consumers are switching from the standard telephone system to an end to
end IP service that provides voice services at a very attractive cost
and adds other possibilities.

France has been something of a test bed for VoIP.  Driven by an
active supplier base that has made VoIP available to a large percentage
of the    population over the last decade, the providers have been rewarded with significant take-up.

The result has been a rapid shift away from PSTN. In France by 2010,
over 50 percent of telephony traffic originating on fixed networks was
started on a VoIP phone.

The whole broadband market and all its consumers are potential
customers, and there is good evidence that consumers see VoIP as a
superior substitute for traditional PSTN calls.

“We expect there to be over three quarters of a billion fixed line
broadband subscribers by the end of 2015, in theory all of them are
targets for VoIP,” said Bosnell.

Any projections about the size and value of the VoIP market should be
treated with caution.  At this stage in the development of a market
there are so many variables that forecasting models can easily be off by
a significant margin. For example, an increasing number of subscribers
are doing without a fixed line telephone service at all, relying instead
on mobile.

Point Topic’s analysis on VoIP has so far focused on fixed line
services, however Internet telephony, where services like Skype are
active, is a
more enigmatic market.

“It is highly fragmented and generally served by companies who don’t
or won’t report regular statistics and revenues.  However Skype, the
market
leader, has had considerable publicity recently and does report some
numbers.  From these we estimate that there are more internet telephony than VoIP users, with Skype alone accounting for almost 150 million regular callers,” said Bosnell.

However revenue generated is much lower.  At the end of 2010 it had
around 9 million paying users generating $8 a month on average.  Again
it is the potential size of the cake that makes for some attractive opportunities.

“If Skype continues to grow as it has been and manages to keep its ARPU
at the current level then it will be generating in the region of $2
billion a year by the start of 2016.  If you work hard and manage to marry your
internet telephony service with a major mobile device manufacturer and solve any number of technical and regulatory issues, the market could really explode,” concluded Bosnell.

By TelecomLead.com Team
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