VoIP Adoption, Cloud Will Continue to Play Important Role in New Year

A new year is close at hand, and changes in telecommunications will likely continue to evolve in 2014.

In a recent article, “Top Telecom Business Trends in 2014,” appearing in Billing World, Charlie Reed, director of quantitative analytics for Atlantic-ACM, highlighted some telecom predictions for the New Year. Many of these relate to VoIP adoption and virtualization, cloud, as well as hosted services.

For example, during the year business will continue to move to Voice over Internet Protocol (VoIP) products. Customers will likely seek features for Unified Communications (UC) which resemble what they find on their smartphones. He said the features are often connected with VoIP.  That will lead to increased differences between VoIP and time-division multiplexing (TDM).

There will be increasingly less demand for use of copper networks, too, as telecoms keep on pushing customers to more advanced options such as VoIP. It likely will include a bundle with Ethernet DIA (dedicated Internet access), which lets enterprises connect their local area networks with the public Internet.

In another trend, enterprises will opt for VoIP and will see lower costs thanks to IP trunking. Business VoIP will up the share of the business voice market 17 percent, as of the current year, to over 40 percent by 2018, according to Atlantic-ACM.

Another important trend for the New Year relates to the cloud. The cloud will be an important element in database initiatives, Reed said.

“The applications…all have one thing in common—they either necessitate or are better managed in cloud environments,” Reed adds. “Companies will balk at purchasing PCs, services and switches to implement new computing processes as Amazon Web Services and others enable easy and inexpensive testing, implementation and scaling for computing, processing and storage needs, knocking down hurdles that existed in the past.”

Carriers will concentrate on the cross-selling of cloud services. Cloud services remain popular because of their image, associated margins and potential for growth. He also predicts that some carriers will try to acquire other technology businesses in trying to build up their cloud portfolios. Still, Amazon Web Services, and to a lesser degree Microsoft and Google are serious competitors. So network services will continue as a key source of revenue for carriers, with additional revenue predicted from cloud services.

As businesses move their IT infrastructure to cloud solutions, carriers will see more network monitoring, security and other managed services, Reed said.

Cloud connectivity will lead to revenue growth from Ethernet services and virtual private networks. Increasingly, mission-critical applications will be hosted in the cloud. That means connections will come more through Ethernet or private IP VPN connections between companies. There will be more private connections to data centers, as well.

So with the New Year, telecom companies which keep their eyes on evolving trends will have a competitive edge over their less-attuned rivals.

Edited by Alisen Downey