VoIP Industry 2008

VoIP is clearly making it’s presence felt on a world-wide level. In the past several years technology has dramatically improved bringing Voice over Internet Protocol services into the same arena with large traditional telephony carriers. For 2008, the story on VoIP will be about technology with increased business market penetration, improved consumer success and growing dominance by cable providers with in the US residential market.

Here’s a breakdown on industry sectors:

Business VoIP

The big news back in 2005 for VoIP was that U.S. revenues had finally broken the $1 billion mark, raising the question, “Is VoIP finally here?” On the opposite spectrum the big news in 2007 was the sales of PSTN (public switched telephone network) PBX’s barely broke the $1 billion mark, with speculation that could be the last time ever. These days in the enterprise market many are asking,“Is PSTN still around?”

There’s been no question IP PBX systems have been treading on PSTN’s market share for some time. In 2007, hybrid IP PBX systems accounted for two-thirds of all lines sold, while pure IP systems alone made up for 18 percent. In addition, according to MarketResearch.com, 50 percent of global telecom traffic is now handled over IP, and this figure could increase to 75 percent over the next few years.

Residential VoIP

For consumers, the transition to VoIP has been somewhat modest on the global scale. For 2007, Infonetics reported just under 80 million VoIP subscribers globally, with the highest number of new subscribers in the Asia Pacific region. That said, it has been forecasted by MarketResearch.com that VoIP subscribers would increase to 135 million by 2011, and with the rising trend in adoption rates that appears very likely.

U.S. VoIP Market

Telecom industry professional, Ike Elliot, created a comparison analysis of the top six VoIP providers ranking them based on revenue and subscribers. It turns out that of the six providers, 4 are cable companies (Charter Communications, CableVision, Time Warner Cable Inc., and Comcast,) while the other two providers are pure VoIP (Skype and Vonage).

Vonage ranked third and Sype came in at fifth place, with around 23 percent of revenue and 27 percent of subscribers in a market with revenues at an estimated $1.44 billion. Unfortunately for Vonage and Skype, Elliott reports, the cable companies’ VoIP-subscription rates are accelerating while those of the pure VoIP providers are slowing. And to make matters worse, 73 percent of the US residential VoIP market has already been captured by the major cable companies.