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September 18, 2006

Mobile VoIP to Outpace Fixed VoIP Services by 2012, Report Says

Mobile voice over Internet Protocol (VoIP) services will outpace the fixed side of the business in the U.S. and Western Europe by 2012, U.K. research firm Analysys predicted in its latest study.
By 2012, cellular VoIP services are estimated to generate revenues of $18.6 billion (15.3 billion Euros) in the U.S., compared with fixed VoIP revenues of $11.9 billion (9.8 billion Euros). In Western Europe, mobile VoIP will hit $7.3 billion (6.0 billion Euros) while the fixed side will amount to $6.9 billion (5.7 billion Euros), according to the new report.

While cellular technologies currently don’t have the capacity to enable carrier-grade voice services, all that will change as operators upgrade their networks beyond the current 3G iterations. Following the upgrade of CDMA2000 1× Evolution Data Optimised (EV-DO) networks to Revision A from 2007, and the upgrade of W-CDMA networks to 3G Long Term Evolution (LTE) from 2010, there will a compelling case for mobile operators to migrate their voice services from circuit-switched voice to VoIP.
“The capacity, cost per megabyte and quality of service of existing 3G cellular technologies –including EV-DO Revision 0 on CDMA2000 networks and High Speed Packet Access (HSPA) on W-CDMA networks – are not yet adequate to support a significant move to wireless VoIP services,” notes the report’s co-author, Mark Heath. “However, EV-DO Revision A and 3G LTE will respectively create the cost benefits and new service opportunities that trigger the migration to mass market cellular VoIP.”
Other key findings from the report, entitled “Forecasting the Commercial Impact of Wireless VoIP in the USA and Western Europe,” include:
  • By 2015, cellular VoIP will carry 28 percent of all fixed and mobile voice minutes in the U.S. and 23 percent in Western Europe
  • Mobile operators will position cellular VoIP as a premium voice service, emphasising quality of service and a range of value added features (such as presence information, instant messaging and multimedia sharing) in order to resist the erosion of voice prices
  • Cellular VoIP will dominate the mix of wireless VoIP services in developed markets, with VoIP over wireless local area networks (also known as WiFi (News - Alert) Telephony) and VoIP over broadband wireless access (BWA) technologies (such as WiMAX) relegated to niche roles.
“Operators need to consider the migration to all-IP core networks and the introduction of VoIP-enabled handsets, as well as the evolution of their radio networks,” co-author Alastair Brydon said.
Robert Liu is Executive Editor at TMCnet. Previously, he was Executive Editor at Jupitermedia and has also written for CNN, A&E, Dow Jones and Bloomberg. For more articles, please visit Robert Liu's columnist page.


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