VoIP needs to be introduced to consumers for it to take off

April 6, 2005

After a very slow beginning, VoIP (voice over Internet protocol) service is starting to convince consumers who are attracted by the low price. IDC (International Data Corporation) thinks residential VoIP subscriptions will increase from 3 million this year, to about 27 million by 2009.

Though still relatively small, the VoIP market is crowded with competitors. And IDC expects the market to grow even more competitive.

A major challenge for VoIP providers is making the service known to consumers. A Harris Interactive survey found that just 9% of consumers familiar with VoIP currently use it.

The Harris survey also found that few consumers expect to become VoIP subscribers in the near term.

Only 2% said they were "extremely likely" to use VoIP in the next year, and 4% were "very likely" to use it. Over one-half of respondents said that they were "not very" or "not at all" likely to use VoIP.

Even among the respondents who were familiar with VoIP, only 14% described themselves as "very" or "extremely" familiar with it.

William Stofega, senior analyst in IDC's VOIP Services Research program, describes what lies ahead for competing providers: "The market for VOIP services is still in the very early stages of development and carriers and equipment vendors need to plan for a marathon."

For its part, eMarketer believes that consumer VoIP adoption will take off in 2006, once major telecom carriers unveil their service offerings and begin to compete in earnest with their rivals from the cable industry.

Source: eMarketer

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