Research Shows VoIP Market to Double in Next Five Years

It's no wonder voice over IP has been placed at the top of the Top 10 list of the hottest growth industries in the world (and, by contrast, wired telephone service has been judged one of the top 10 dying industries), says research firm IBISWorld USA.

Another research company, Point Topic, has released data indicating that the market for voice-over-IP phone calls will more than double to $40 billion within five years. The company said Wednesday that the global growth of fixed-line voice over internet protocol (VoIP) services grew 12.6 percent in 2010 with global revenue at $17.3 billion, reported Reuters.

“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.”

The U.S. Federal Communications Commission (FCC) said in March that consumer and business use of VoIP rose 21 percent in the year to June 2010. By contrast, phone calling via traditional lines fell eight percent.

“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.

Point Topic warned, however, that there were so many variables that forecasts could easily be off by a wide margin.

An increasing number of subscribers for example have no fixed line telephone service at all, relying instead on mobile.

Skype, which was bought by Microsoft for $8.5 billion last month, has around 150 million regular users, but Bosnell added that generated revenue was much lower.

At the end of 2010 it had around 9 million paying users each generating $8 a month on average.

“If Skype continues to grow as it has been and manages to keep its ARPU (average revenue per user) at the current level then it will be generating in the region of $2 billion a year by the start of 2016,” said Bosnell.

Microsoft has said that it plans to integrate Skype into a wide range of products including the Windows phone and Outlook.

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Tracey Schelmetic is a contributing editor for virtual-pbx. To read more of Tracey's articles, please visit her columnist page.

Edited by Jennifer Russell