Report Reveals VoIP Market Still Fragmented, but Growing

A Transparency Market Research report says the wholesale VoIP market is highly fragmented, pushing services providers to find new ways to differentiate themselves.

The fragmentation the Transparency Market Research (TMR) report highlights in the VoIP market is noteworthy. According to the firm, the top four companies in the market, which is made up of AT&T, Vonage, Skype, and Sprint, only accounted for 12 percent of the market in 2013. This is because the vast majority of services are the same, with little differentiation between VoIP providers, whether it is a large multinational enterprise or a local SMB.

In its analysis of the VoIP services market, TMR looked at corporate and individual consumers with a global industry analysis.

Established companies with a global presence that are capable of making large investments will, according to the report, have a clear competitive edge in the coming years. For these companies, the ability to develop innovative and successful VoIP services that are interoperable, which is being driven by multi-channel and multi-device communication used by individual consumers and corporations, will play a big role in their growth.

Within the business ecosystem, the rising number of organizations implementing bring your own device (BYOD) initiatives will increase VoIP services as personal mobility drives demand. With remote work and collaboration now a pillar in today's workforce, VoIP is delivering the communications tools they need to bring colleagues and partners together no matter where they are on their mobile device.

A TMR analyst stated, “Thanks to the easy installation of VoIP services at both ends, they represent a feasible way of allowing real-time face-to-face communication between various entities.”

Smartphones and tablets are playing a bigger role in the growth of the global VoIP services market because the technology is no longer limited to desktop phones and personal computers. The report said developers of VoIP services will have promising growth prospects in the coming years as the adoption rate of smartphones and tablets continues to increase around the world.

The growth in mobile VoIP will require the right infrastructure, which is being limited in developing countries because they are still operating on 2G or 3G telecom networks. For these countries, the capacity of their telecom networks makes it difficult or impossible to access VoIP services. Considering developing countries represent a large percentage of the global population, service providers will have to wait until the network is upgraded to increase their presence in these markets.

In developed countries where 4G is almost standard, this is not a problem. And as 5G network technology comes online in 2020, there will be new opportunities for innovative VoIP related services.

The biggest challenge according to TMR is going to be smartphone adoption, which is low in developing countries. But the arrival of sub $50 smartphones in the marketplace is quickly solving that problem, leaving the network infrastructure to deal with. 

Edited by Alicia Young